Mortgage Commitment Letter: What It Is and the NYC Deadline
Back to the NYC Real Estate Blog
A mortgage commitment letter is a lender’s firm, written promise to fund your loan, issued after full underwriting on a specific property. It’s different from a pre-approval, which is an estimate. In New York, your purchase contract sets its own financing contingency deadline, commonly 30 to 45 days after signing, by which you need this letter or an extension.
We represent NYC buyers, and this document has real teeth here. Miss the contract’s financing deadline without an extension, and you can lose the protection that gets your deposit back if the loan falls through.
It’s the letter that stops being a maybe.
Mortgage commitment letter, what it actually is
A commitment letter comes at the end of full underwriting. That means verified income, assets, credit, and the appraisal on the specific home you’re buying. It states the loan amount, the rate, the term, and any remaining conditions, with an expiration date.
Two versions exist, and knowing which one you’re holding matters.
Conditional vs firm commitment letter
Conditional has an escape hatch built in, firm does not, a distinction Chase’s own explainer on commitment letters draws the same way.
| Conditional commitment | Firm commitment | |
|---|---|---|
| When it arrives | Early, once underwriting is mostly done | After a signed contract, all conditions cleared |
| What’s left | A document or two: insurance proof, a final income check | Nothing. Ready to fund |
| Property address listed | Not always | Yes |
| Rate and term | Preapproved amount | Locked |
Our mortgages and financing hub covers where this sits in the full loan process.
Commitment letter vs pre approval
Pre-approval is an opinion. A commitment letter is a promise with a signature. A pre-approval letter, covered in our down payment and credit hub, tells you and a seller what a lender is likely to approve. That review stops short of underwriting the specific property.
A commitment letter is the lender actually agreeing to fund, in writing, once underwriting is essentially done. Sellers, attorneys, and co-op boards all weigh it far more heavily than a pre-approval. Much less is left that could still go wrong.
How long is a commitment letter valid
Typically 30 to 60 days. Long enough to close, if nothing about your life changes in the meantime. The exact window depends on the lender and the loan program, and it’s printed on the letter itself.
A new job, a big purchase on credit, or a dip in your credit score before closing can all give the lender grounds to withdraw it. Keep your finances still until you have the keys.
The financing contingency deadline in NYC
Here’s the part a national guide never mentions. A standard NYC contract of sale includes a financing contingency with its own deadline: the date your attorney has circled since the day you signed. Commonly 30 to 45 days after signing, it’s the date by which you must either deliver a commitment letter or ask the seller for an extension.
Miss that date without an extension, and you can lose the contingency’s protection. If the loan later falls through, you may not get your 10% deposit back. Your attorney tracks this date closely. If your lender is running behind, they ask for more time before the clock actually runs out, not after.
For a co-op, the stakes stack higher. Many boards want the commitment letter, not just a pre-approval, as part of the board package or before the interview. A conditional approval reads as an unfinished application.
What we watch for on a client’s commitment letter
The fine print is where a clean file turns conditional again. We read every listed condition with a client before they assume they’re done. A commitment letter with three open items is not the same as a firm one. As Georges puts it, “it’s all about the numbers and the execution,” and a missed condition on a commitment letter is exactly the kind of execution detail that ends a deal.
We also track the expiration date against the closing date from day one, so nobody discovers a gap two weeks before the walkthrough. On an average purchase our commission rebate returns roughly $22,000 at closing. Run your full timeline on the closing cost calculators alongside your lender’s.
Common questions
What is a mortgage commitment letter? A lender’s written, firm agreement to fund your loan for a specific property, issued after underwriting. It states the amount, rate, term, and any remaining conditions.
Is a commitment letter the same as a pre-approval? No. Pre-approval is a preliminary estimate. A commitment letter follows full underwriting and is close to a binding promise to lend.
How long does a mortgage commitment letter last? Usually 30 to 60 days, printed on the letter. A major financial change before closing can void it even within that window.
What happens if I miss my financing contingency deadline in NYC? You may lose the contract’s protection that returns your deposit if financing falls through. Ask for a written extension from the seller before the deadline passes, not after.
Does a co-op board need my commitment letter? Many do, or at least strongly prefer it over a conditional pre-approval, since it shows the financing is essentially locked before the board reviews your file.
Nicole Fishman Benoliel co-founded NestApple in 2017. She's a lawyer admitted to the New York bar - her law degree is from La Escuela Libre de Derecho in Costa Rica, with further study at IE Business School in Madrid and an LLM from Fordham in New York. She does not act in a legal capacity at NestApple; every client is referred to an attorney who handles real estate deals full time.
