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In this episode of the Sigma Real Estate Glossary, the word of the day is "commitment letter." A commitment letter is a binding offer from a lender that specifies the amount of the mortgage, interest rate, and repayment terms. Most commitment letters are conditional, meaning the lender will fund the mortgage if certain conditions are met within a specified timeframe. Common conditions may include providing additional documents, maintaining credit scores and income levels, obtaining homeowner's insurance, and making required down payments. To ensure a smooth transaction, it is important to fulfill these conditions promptly.
