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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 includes the mortgage amount, 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 include providing additional documents, maintaining credit score and income, having homeowner's insurance, and showing ability to make down payments for a smooth transaction.
