Document background
The Letter of Reservation is a crucial preliminary document in Indonesian property transactions, commonly used when a potential buyer wishes to secure their interest in a property before proceeding with the full purchase agreement. This document type is particularly relevant in new development projects or pre-sale situations where properties are being sold off-plan. The Letter of Reservation typically includes the reservation fee amount, the duration of the reservation period, and basic terms of the intended purchase. It serves as a formal commitment while allowing time for due diligence, financing arrangements, or other preparations. Under Indonesian law, this document provides certain legal protections for both parties and is often a prerequisite for proceeding with a full sale and purchase agreement. The document must comply with Indonesian civil law, property regulations, and consumer protection requirements.
