If we issue a CD does that obligate us to close the loan? . I think more specifically because there is a specified closing date on the CD, once issued, must we close on that day? Thanks!

No.

Closings can be postponed or cancelled altogether for a variety of reasons, even after the CD has been issued. A last-minute problem in the title, a seller who is ill and can't make the closing, a seller who dies, are some of those I've heard about.

Awesome! Thank you for both for your help. John, your expanded answer definitely helps solidify the reasoning, I appreciate that.

Question on this. CD was given 3 days prior to closing. 2 days prior to closing the closing got cancelled. Now, 10 days later, the borrower is back on board and ready to close - oh and also decided he wants to raise the loan amount, which will throw one fee out of tolerance. Since we've already issued the CD, we cannot now issue a LE, correct? Our only option is to issue another CD within 3 days of that request, even if closing is 10 days out, correct?

Define 'the closing got cancelled'.
Do you mean it was delayed or the borrower just said 'no thanks.'
If it was the latter, I'd put the last CD in the file and mark it 'approved but not accepted.'
Then I'd start all over again with a new LE for the new loan amount and then a CD to follow.

It was just a delay. The borrower switched jobs, so we had to push off closing until we could get the new job verified. What would you do in this situation?

had to push off closing

How long?

Correct. If you decide to go forward with the closing as requested, the fact that the CD was issued shut down any ability to issue another LE. But you can issue a revised CD to reset any costs resulting from the increased loan amount, if you do so within three business days of learning of the increased amount. After that, there's no more CDs to be issued unless there's another changed circumstance increasing a cost.

Closing will have been pushed off for about 3 weeks when he finally does get to closing.

Today is our 3rd day from the loan amount increase request, so we will issue another CD, and give it to the borrower then proceed with the closing as normal.
Thanks!!