What’s the Difference Between a Mortgage Commitment Date and “Clear to Close”?
In Massachusetts real estate transactions, buyers often hear two important milestones from their lender: the mortgage commitment date and clear to close. While they sound similar, they mean very different things—and misunderstanding the distinction can lead to unnecessary stress or confusion during a transaction.
Mortgage Commitment Date
A mortgage commitment means the lender has reviewed the buyer’s application and supporting documentation and has agreed to lend—subject to certain conditions. These conditions may include:
Updated pay stubs or bank statements
Final appraisal review
Title work and insurance
Satisfactory review of the Purchase & Sale Agreement
In most transactions, the mortgage commitment date is tied directly to a contingency in the Purchase & Sale Agreement. If the buyer does not receive a commitment by that date, they may have the right to terminate the contract without penalty.
Importantly, a mortgage commitment does not mean the loan is fully approved or ready to fund.
Clear to Close
“Clear to close” is the lender’s final approval. It means:
All underwriting conditions have been satisfied
Final documents are approved
The lender is ready to schedule funding
Only after a buyer is clear to close can the closing be confidently scheduled.
Why the Distinction Matters
In Massachusetts, where closings are attorney-conducted and recording is required to transfer ownership, timing is critical. A buyer may have a mortgage commitment but still not be ready to close if outstanding lender conditions remain.
Understanding this difference helps set realistic expectations and keeps transactions on track.
Disclaimer: This article is for general informational purposes only and is not legal or financial advice. Buyers should consult with their lender and a Massachusetts real estate attorney regarding their specific transaction.
