Definition: A lender's commitment to provide longer-term financing that will replace interim financing when stated conditions are met.
Example
A developer arranges permanent financing to take out the construction loan after completion and required leasing conditions.
Keep the distinction clear
A commitment is subject to its terms, deadlines, and conditions. It is not an unconditional promise that funding will occur regardless of project performance.
Related terms
Mortgage Lender · Underwriting · Performance (Contract)
Keep studying
Mortgages: Borrower, Lender, Ownership, and Key Clauses
References: California DRE: real estate glossary · CFPB: mortgage key terms
Pronunciation (US): TAYK-owt kuh-MIT-munt (capitals show stress)
Pronunciation reference: Merriam-Webster
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