It is subject to negotiation by letter (7)
I believe the answer is:
tenancy
'it is subject to negotiation' is the definition.
The definition suggests a singular noun which matches the answer.
'letter' is the wordplay.
I cannot really understand how this works, but
'letter' could be 'en' (I've seen this in other clues) and 'en' is found within the answer.
This explanation may well be incorrect...
'by' is the link.
Can you help me to learn more?
(Other definitions for tenancy that I've seen before include "Temporary occupation of land" , "Rental period" , "Letting arrangement" , "Temporary occupation of property" , "Rental arrangement" .)