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In this video tutorial, the host discusses the concept of a commitment letter in real estate. A commitment letter is a formal offer from a lender detailing the mortgage amount, interest rate, and repayment terms. Most commitment letters are conditional, meaning the lender will only fund the mortgage if certain conditions are met within a specific time frame. Common conditions may include providing additional documents, maintaining credit score and income levels, obtaining homeowner's insurance, and showing ability to make required down payments. To ensure a smooth transaction, it is important to meet these conditions.