Commitment: 1. A pledge to do a certain act, such as a promise by a lender to loan a certain amount of money at a specific rate of interest to a qualified borrower, provided the loan is made by a certain date. 2. Also refers to an agreement by a title insurance company to issue a policy in favor of a proposed insured upon acquisition of a specific property.

 

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Commitment: 1. A pledge to do a certain act, such as a promise by a lender to loan a certain amount of money at a specific rate of interest to a qualified borrower, provided the loan is made by a certai . . . View Full Definition

Commitment Fee: Describes a trader's obligation to accept or make delivery on a futures contract. Related: Open interest.

Standby Takeout Commitment: An agreement by an interim lender to advance funds to take out a construction lender.

Advance Commitment: A promise to sell an asset before the seller has lined up purchase of the asset. This seller can offset risk by purchasing a futures contract to fix the sales price approximately.