Commitment Letter

Definition

  • A formal document supplied by a lender to a home buyer that details the terms under which the lender will lend money to the home buyer. Also known as a "loan commitment." This letter indicates the contingencies that must be cleared prior to funding the loan.

Synonyms
pledge, assurance note, vow, promise

Related Terms and Acronyms

  • Commitment Definition,
    • A written agreement from a lender promising to lend money on certain terms for a specified time period.
  • Conditional Commitment Definition,
    • A promise by a lender to make a loan if the borrower meets certain requirements.
  • Firm Commitment Definition,
    • A lender's promise to lend money to a specific borrower on specified terms at a certain time.
  • Loan Commitment Definition,
    • A lender's promise to advance a specific sum on specific terms.
  • Pre-approval Letter Definition,
    • A document from a lender or broker, estimating how much a potential home-buyer could borrow, based on current interest rates and a preliminary look at credit history.
  • Standby Commitment Definition,
    • A commitment from a lender to make a loan in a specified period of time on specified terms with the understanding that the borrower will not likely draw down the funds.
Compare. Calculate. Apply today.
Compare Mortgage RatesMortgage CalculatorsApply for a Mortgage