Once your application for a loan has been processed, the lender will make a decision concerning making a commitment on the loan.

If the lender decides to approve the loan, you will receive a Commitment Letter from the lender notifying you of their decision. The Commitment Letter may include certain conditions, such as repairs to the home, before the final approval is made.

Also included in the Commitment Letter is the "lock-in" rate. This is the lender’s promise to make the loan to you at a specified interest rate and number of points. A lock-in rate is generally honored for a certain period of time, such as 30 days. If the lock-in period expires before your closing date, you may have to pay additional fees to extend your lock-in period.

If the lender decides to reject your application for a loan, you will be sent a rejection letter notifying you of their decision. If you receive a rejection letter, you may present this to the seller to reclaim your earnest money you offered with the Contract of Sale. This letter is proof that you complied with the purchase agreement, and have been formally rejected for a loan.