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In this tutorial, host Jimmy O'Done explains the concept of a commitment letter in real estate. A commitment letter is a binding offer from a lender detailing the mortgage amount, interest rate, and repayment terms. Most commitment letters are conditional, meaning the lender will fund the mortgage if certain requirements are met within a specified timeframe. Common conditions may include the need for additional documents from the buyer, no changes to credit score or income, proof of homeowners insurance, and validation of the ability to make the required down payment. A comprehensive understanding of these conditions is essential for a smooth transaction.