Why you need a Mortgage Committment to Lend

If you are in the market to purchase a home, you will want to have either a pre approval or a commitment to lend document from a mortgage bank or broker with your offer to purchase.
A pre approval means - you have spoken with a mortgage lender and have verbally given them your financial information and permission to order a credit report. The mortgage lender will then have your verbal information analyzed by their computer underwriting software - and give you an approval, subject to verification of the verbal information you have provided. So in reality there is no guarantee you will be approved for a mortgage with a pre qualification.

A commitment to lend means, you have submitted an application with a compete document package to a mortgage lender. You have supplied items such as, pay statements, bank statements, W2's, tax returns, photo ID - and any other required documents. Your loan application package has been approved by the bank, and when you find a property the bank will lend you mortgage money after an appraisal determines you are paying fair market value for the property. It is in your best interest to have the mortgage lender approve you for the maximum mortgage you qualify for. It is easier to ask for less money than it is to ask for more, and you will know for sure your home purchase budget. If you find a property that requires less money than you qualify for, the good mortgage lender will issue a letter with no dollar amount, so your ability to negotiate a price will not be compromised by how much mortgage money you actually qualify to borrow.

When you submit your offer to purchase a property, the seller will most likely chose a buyer who has a commitment to lend - Real Estate Agents know the difference between a pre qualification - and a commitment to lend and they will advise the seller accordingly.

The hardest part of the purchase process for a mortgage is the commitment to lend - and it just makes sense if you are a serious buyer to complete the full process before you start to make offers on a property.


A pre approval or a commitment to lend is a no cost, no obligation process for the borrower. If you are serious about a purchase, chose a lender and have yourself, at no cost and no obligation - approved for a commitment to lend.