When does the RD office issue a conditional commitment?

A conditional commitment from the Rural Development (RD) office is issued once the loan file is submitted by the lender. This step indicates the RD’s preliminary approval of the loan, meaning that they have reviewed the provided documentation and deemed the application eligible for the USDA loan program, pending final conditions.

The issuance of a conditional commitment is crucial because it outlines any additional requirements that must be met before final approval can be granted, typically related to borrower eligibility, property requirements, and financing terms. This commitment serves as a signal to all parties involved that the loan process can move forward, allowing the lender to conduct further necessary actions, such as ordering appraisals or performing additional underwriting tasks.

The other options involve steps that occur either after the conditional commitment is issued or refer to actions that don’t align with the typical timeline of the loan approval process. For instance, the property appraisal is normally requested after the conditional commitment is given, while loan closure occurs much later in the process. Thus, the timing of the conditional commitment directly correlates with the submission of the complete loan file by the lender.