loan commitment

(redirected from Loan Commitments)
Also found in: Legal.

Loan commitment

Assurance by a lender to make money available to a borrower on specific terms in return for a fee.

Loan Commitment

The amount in loans that a bank will make or may be required to make in the near future, but has not yet made. Loan commitments may be open-ended or closed-ended. Suppose a bank approves two loans in a year; one is a revolving line of credit for $50,000 and the other is a business loan for $100,000. One would say that this bank has an open-ended loan commitment of $50,000 (because the principal amount in the loan, when repaid, may be borrowed again) and a closed-ended loan commitment of $100,000 (because once its principal is repaid, it no longer must be committed to that borrower). Banks must disclose their loan commitments.

loan commitment

In real estate,a formal promise by a lender to loan up to a specified amount of money, depending on the appraised value of the collateral, with additional details regarding the interest rate, term of the loan, property on which mortgage will be taken, and a date on which the commitment will expire.

References in periodicals archive ?
The firm said that it has sold loan commitments related to its banking business in China for GBP498m.
The closing of the new loan facility shows that Merck has a very good reputation among its banks owing to its strong position, and that a long-term loan commitment can be obtained with good terms and conditions despite the current financial market turbulence," said Matthias Zachert, CFO of the Merck Group.
Loan commitments and loans have different characteristics, making it difficult to directly compare the prices of these instruments.
Earlier in the autumn of 1998, Nissan secured a similar one-year loan commitment from a group of 10 Japanese banks, led by IBJ.
At the opening of the recent CGI meeting, the Leader of the Indonesian delegation, namely Coordinating Minister for Economic and Financial Affairs Saleh Afiff, did not hesitate to express his optimism that the CGI's loan commitment for Indonesia for 1997/1998 would not decline, saying that if Japan and the United States reduced their loan commitments, the Worm Bank and the Asian Development Bank would do something to compensate for the reductions.
Wachovia Mortgage is a leader in providing its mortgage loan consultants Fannie Mae's Desktop Underwriter technology and the ability to render on-the- spot loan commitments.
Although nonbank entities, such as securitization pools, hedge funds, insurance companies, and pension funds, owned the smallest share of loan commitments, they owned the largest share (62.
Kennedy Funding has the ability to issue loan commitments in as little as 24 hours, which can lead to a closing in less than a week.
Total loan commitments classified as either substandard, doubtful, or loss fell $78.
Since credit began contracting 18 months ago, Wells Fargo has made almost half a trillion dollars in new loan commitments and mortgage originations," said Chief Financial Officer Howard Atkins.
We've made loan commitments in just one day, even with just the raw land as collateral.