Sample Letter of Termination (Purchase and Sale Agreement)

In business, sometimes things don’t work out as we anticipate them to be. You might end up in a contract, but eventually, get dissatisfied with the manner in which the party is delivering or selling their products/services. When caught up in such cases, it’s always recommended that you quit further transactions in a more professional way. While some people may opt to cancel their purchase through the phone, it is always a good idea to send a purchase order cancellation letter.

Defining a termination letter to purchase agreement

Just as the name suggests, a termination letter to purchase agreement refers to an official document written by a consumer to the seller, notifying them that the sales contract has been canceled. Usually, the main purpose of a termination letter to purchase agreement is to bring both parties (the buyer and the seller) to an agreement to hold on a purchase. Other than that, the letter also states where the earnest money shall be deposited/refunded. When purchases are terminated using an official letter, it not only shows professionalism but also helps maintain better relationship down the line.

Free Templates

Access our section offering free templates for letters for terminating sale and purchase agreements. These templates serve as a convenient resource for swiftly drafting effective termination letters. Simplify your communication process and ensure accuracy by leveraging these ready-made templates. Save time and effort while maintaining professionalism and clarity in your correspondence. With our templates, you can confidently navigate the termination process and convey your intent accurately.

Free sample letter of termination for Purchase and Sale Agreement 01

Free sample letter of termination for Purchase and Sale Agreement 02

Free sample letter of termination for Purchase and Sale Agreement 03

Free sample letter of termination for Purchase and Sale Agreement 04

    Tips for writing a good termination letter

    • As a golden rule of thumb, always write the termination letter using a polite and professional tone.
    • Makes sure you provide the reason for canceling the purchase agreement.
    • Indicate in the letter that you are following the stated agreement guidelines and regulations.
    • Make sure you mention the precise Date you would want the termination process to end.
    • Show gratitude for the counterparty for their service. Also, you can wish them well in their future transactions. Who knows, maybe you’ll need their services in the future.

    Common reasons to write this letter

    There are plenty of reasons as to why an individual may decide to terminate a purchase contract. These includes:

    • If the supplies fail to honor their commitment and don’t deliver products/services on the agreed date.
    • When a consumer decides that they can no longer afford the prices of goods/services offered.
    • If the supplier fails to deliver the right type of goods ordered, i.e., they might be of poor quality or substandard. 
    • If the business has decided to close down its operations after making some orders. It would be good for it to notify the supplier not to process the supplies in time.
    • If the buyer suspects any cases of fraud from the supplier.

    Sample termination letter to purchase agreement


    [Buyers name]

    [Buyers contacts & address]


    [Suppliers details]

    [Suppliers address]

    [Date on which the letter is written]

    SUBJECT: Termination letter to purchase agreement

    Dear Sir/Madam,

    I hereby regretfully write this letter to officially notify you that I am canceling the purchase agreement referenced [input reference number], that was signed on [Date when the letter was signed]. The reason as to why I am canceling the agreement is due to _ [mention the reason for your cancellation].

    Due to this reason, we need a full/partial reimbursement of the funds issued in the original agreement. I have attached all the necessary documents that will assist in the cancellation process. However, after this, we shall continue to make other purchases provided that you observe the delivery timeline. Also, I hope that you’ll observe the supply requirements of the latter. I hope for the fullest cooperation from you so that we achieve a seamless and efficient legal formality.

    Yours sincerely

    __ [Name of the sender]

    _ [name of organization]

    Sample letter (Word Format)

    File Format
    • MS Word

    As a business person, you will always get into contracts with different vendors, clients, and suppliers. While some of these contracts will involve verbal communications, some will require legal agreements between the two or more parties. Whichever the case, always keep in mind that some contracts won’t go well as expected and, therefore, will need a termination. However, when you have decided to terminate a contract, always ensure you do it formally through an official purchase agreement termination letter. This will not only sell your professionalism but will also help maintain a positive relationship even after the contract termination.

    About This Article

    Bryan Brown
    Authored by:
    Licensed Attorney - Asset Protection, Business Formation, Contract Drafting, Real Estate, Securities, Tax
    Bryan Brown is a seasoned attorney with a particular passion for empowering small businesses and startups. His comprehensive suite of services covers crucial areas like Asset Protection, enabling businesses to shield their pivotal assets, and Business Formation, guiding new enterprises through the foundational stages. Bryan's prowess in Contract Drafting ensures that businesses operate on robust agreements, while his insights into Real Estate, Securities, and Tax matters provide a holistic legal framework for clients. With a reputation for thoroughness and dedication, Bryan Brown stands as an invaluable asset for any business aiming to thrive in the Texas environment.

    Was this helpful?

    Great! Tell us more about your experience

    Not Up to Par? Help Us Fix It!

    Keep Reading

    Thank You for Your Feedback!

    Your Voice, Our Progress. Your feedback matters a lot to us.