commitment-letter-for-financing

name	commitment-letter-for-financing
title	Commitment Letter for Financing
description	Drafts a U.S. financing commitment letter memorializing a lender's binding agreement to fund under specified economic terms, conditions precedent, and fees. Covers commercial real estate acquisition, construction, business expansion, and general commercial lending. Use when drafting loan commitment letters, lender commitment letters, financing commitments, or pre-closing funding commitments.
author	CaseMark
author_url	https://github.com/CaseMark/skills/tree/main/skills/legal/commitment-letter-for-financing
license	Apache-2.0
version	0.1.0
execution_mode	open
jurisdiction	us
practice	finance
language	en
tags	["drafting","letter","transactional"]

Commitment Letter for Financing

Drafts a lender's commitment letter bridging preliminary negotiations and final loan documentation, with binding economic terms and enumerated conditions precedent to funding.

Prerequisites

1. Party details — legal names, entity types, jurisdictions, principal addresses for lender, borrower, guarantors, and co-borrowers
2. Loan economics — commitment amount, interest rate structure (fixed/variable, index, margin), term, amortization, balloon provisions, fee schedule
3. Transaction type — CRE acquisition, construction, business expansion, or other (drives collateral and condition requirements)
4. Collateral description — asset type, estimated value, location/identification, existing liens
5. Proposed closing date — for commitment expiration and funding timeline

Output Structure

1. Header & Parties

• Commitment date and lender letterhead placeholder
• Full legal names, entity types, jurisdictions for all obligated parties
• Binding vs. non-binding designation — specify which provisions survive regardless of overall character

2. Financial Terms

Term	Detail
Commitment Amount	Fixed sum or maximum; note if multiple disbursements
Interest Rate	Fixed or variable; index (SOFR/Prime) + margin; floor if applicable
Loan Term	Maturity date; amortization period; balloon amount/date
Repayment	Frequency; P&I or interest-only period(s)
Use of Proceeds	Stated purpose; deployment restrictions
Fees	Commitment (refundable/non-refundable), origination, unused line, prepayment penalty/yield maintenance
Funding Date(s)	Anticipated date; multi-draw schedule if applicable

3. Conditions Precedent to Funding

Due Diligence & Valuation

• Satisfactory legal, financial, environmental, and operational due diligence
• Acceptable appraisal/valuation of collateral
• No material adverse change in borrower's condition or collateral value