Mortgage Commitment Letter

A mortgage commitment letter (also called a loan commitment or conditional commitment) is a formal written document from a lender confirming it will fund a mortgage loan for a specified borrower, property, and loan amount — subject to any outstanding conditions. It is issued after full underwriting review (income, assets, credit, and property appraisal) and represents a stronger guarantee than a pre-approval. The CFPB mortgage commitment explainer covers what borrowers should confirm before relying on one.

A pre-approval is issued before you have a specific property — it is based on a credit check and stated income, and typically expires in 60–90 days. It is not binding. A commitment letter is issued for a specific property after full underwriting (including appraisal) and is a binding agreement to fund (subject to conditions). The mortgage process flow: pre-qualification → pre-approval → loan application → underwriting → commitment letter → closing. At the commitment stage, most of the risk to the deal has been removed.

Most commitment letters are "conditional commitments" — they bind the lender to fund provided certain conditions are met. Common conditions include: (1) no material change in employment, income, or credit before closing, (2) clear title (title search complete with no liens), (3) homeowner's insurance binder received, (4) final income verification (pay stubs within 30 days of closing), (5) satisfactory appraisal if not already ordered, (6) flood zone determination. Review every condition carefully — an unfulfilled condition can void the commitment. The CFPB Loan Estimate guide explains what other disclosures accompany the commitment process.

Most commitment letters are valid for 30–60 days. If your closing is delayed beyond the commitment expiry, you must request an extension — the lender may re-underwrite (reverify employment, pull a new credit report) and may charge an extension fee. In a rising rate environment, lenders may also require the rate lock to be extended at your cost. Always confirm the expiry date of your commitment and your rate lock separately — they may not match. Contact your lender at least 10 business days before either expires.

Yes — a lender can revoke a commitment if any condition is not met or if there is a material change in your financial situation before closing. Common causes of revocation: job loss or change, large unexplained deposits or credit inquiries, new debt (car loan, credit card), significant decline in property value, or title issues. After receiving a commitment letter, do not: change jobs, make large purchases on credit, open new accounts, or co-sign for anyone. The CFPB guide on loans falling through after approval explains the most common scenarios.

No. A commitment letter is issued when underwriting approves the loan subject to conditions. A clear to close (CTC) is issued when all conditions have been satisfied and the lender is ready to fund. The CTC typically comes 1–3 days before closing and triggers the preparation of final closing documents and the funding wire. Between commitment and CTC, you (and your closing team) are working through the condition checklist. The CFPB Closing Disclosure resource covers what documentation accompanies the CTC stage.