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In this episode of Sigma Real Estate Glossary, the word of the day is "commitment letter." A commitment letter is a binding offer from the lender, specifying the mortgage amount, interest rate, and repayment terms. These letters are conditional, meaning the lender will fund the mortgage only if certain conditions are met within a specific time frame. Common conditions include providing additional documents, maintaining credit score and income levels, obtaining homeowner's insurance, and making required down payments. To ensure a smooth transaction, it is important to meet these conditions.
