The mortgage contingency ties
the sale to your loan.
A mortgage contingency is the clause making the purchase depend on the buyer actually getting the loan. On the New Jersey state form it runs on a written commitment due on a date the parties negotiate, and the clock starts when attorney review ends.
- A mortgage contingency is the clause making the purchase depend on the buyer actually getting the loan
- On the New Jersey state form the buyer applies soon after attorney review ends, and the written commitment is due about thirty days from that same point
- The commitment date is negotiable, the same as the rest of the contract
- If the commitment does not arrive, either side may have the right to void, which is why the date belongs in the calendar the day the contract is signed
Term. Written by The JK Realty Group.
A mortgage contingency is the clause that makes the purchase depend on the buyer actually getting the loan. A pre-approval is a lender's early read on a borrower. A commitment is the lender saying yes to this borrower on this property, and it is the commitment the contract cares about.
On the standard New Jersey form the sequence is tighter than most buyers expect. The buyer applies soon after attorney review ends, and the written commitment is due about thirty days from that same point. Two things follow from that. The clock starts at the end of attorney review rather than the day the offer was accepted, so a long review shortens nothing and a fast one does not buy time. And the commitment date is negotiable, the same as the price and the closing date, so it is a term you can talk about at the offer instead of a fixed rule you inherit. If the commitment does not arrive by the date in the contract, either side may have the right to void, which is why that date belongs in the calendar the day the contract is signed rather than remembered later.
Say a buyer in Camden County goes under contract and attorney review ends on the fifth of the month. The application goes in that week, and the commitment date lands roughly thirty days out. Underwriting asks for one more document in week three. Because the date was in the calendar from day one, there is room to get it in. The same request found the day before the date is what turns a routine file into an extension request.
What to ask, and who answers it. Your lender is the one who can say how long their underwriting is actually running right now and whether the standard window fits your file, so ask that before the date is agreed rather than after. Your agent can tell you how sellers in your town and price band are reading commitment dates in the offers they see. Your attorney is the one who handles the dates and any notice the contract calls for, and what a missed date would mean for you specifically is a question for them.
Our take
The clock starts when attorney review ends, not when you found the house, and the commitment date is a term you negotiate rather than inherit. If you are writing with a loan, that date belongs in the offer conversation.
Writing an offer with a loan? Let's talk.
General information about what the standard New Jersey contract contains. Your own dates, and what a missed one would mean for you, are questions for a licensed New Jersey attorney and your lender. General information, not advice about any specific property. The JK Realty Group, brokered with OMNI Real Estate Professionals. Equal Housing Opportunity. See our Terms of Use for how we source and credit these posts.