commitment fee

Definition of "commitment fee"
  1. A charge that a borrower must pay when a lender agrees to secure a specified loan rate and points
How to use "commitment fee" in a sentence
  1. The borrower signed the agreement and paid the commitment fee to the bank.
  2. The bank charges a commitment fee, which ensures the agreed loan rate is locked in.
  3. After negotiating the loan rate, they had to secure it with a commitment fee.
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