Which of the following is used to communicate to the construction lender the details of how the loan will be paid off?

The loan commitment letter is a vital document in the process of securing financing for construction. This letter serves to formalize the lender's agreement to provide the loan under specified terms and conditions. It typically outlines critical information such as the loan amount, interest rate, repayment schedule, and any contingencies that must be met before the loan is finalized.

By providing a clear commitment from the lender, this document communicates to all parties, including the borrower and any contractors involved, how and when the loan will be repaid. It assures the construction lender that there is a well-defined plan for repayment, which is crucial for both risk assessment and project planning.

In contrast, other options like the balloon payment assurance document, monthly draw schedule, and credit assurance contract address different aspects of financing. A balloon payment assurance document pertains to loans that have a large final payment, a monthly draw schedule relates to the timing and amounts of disbursements made during construction, and a credit assurance contract generally relates to guarantees related to creditworthiness rather than loan repayment specifics. Each plays an important role in the financing process but does not fulfill the same purpose as the loan commitment letter in terms of communicating loan repayment details.