Sample Letter of Explanation for Mortgage Payment with Amount

When it comes to applying for a mortgage, there are times when a Letter of Explanation may be required by the lender to explain certain details related to your application. At BizzLibrary.com, we offer a professionally drafted Letter of Explanation template that can help you present a clear and concise description of any circumstances that may affect your mortgage application.

What is a Letter of Explanation?

A Letter of Explanation is a document that provides details and clarification for any variances or inconsistencies that may exist between your financial profile and the loan program's guidelines. Common reasons why a Letter of Explanation may be required include:

• Fluctuations in income or employment history
• Recent credit inquiries or new accounts
• Large deposits or withdrawals from bank accounts
• Delinquent payments or charge-offs

By providing a Letter of Explanation, you demonstrate your willingness to be transparent and accountable for any issues that may be considered risks by the lender.

Why Do You Need a Letter of Explanation?

The mortgage application process involves a thorough review of your credit history, employment and income verification, and other personal details. Lenders want to make sure they are lending to responsible borrowers who are likely to repay the loan. A Letter of Explanation can help clarify any discrepancies or concerns that may arise during the underwriting process, ultimately increasing your chances of being approved for a loan.

How to Use the Letter of Explanation Template

Our Letter of Explanation template is designed to help you provide a clear and concise explanation of any issues that may affect your mortgage application. Simply download the template in DOCX format and customize it with your personal details. For example, you can use the template to explain the following:

• Why your income may have fluctuated over the past few months or years
• Why certain bills have been paid late or missed
• Why there was a particular deposit or withdrawal from your bank account
• Why you are borrowing a specific amount and how you plan to repay it

Be sure to keep your Letter of Explanation short and to the point. Avoid making excuses or being defensive. Instead, focus on providing factual, objective information that demonstrates your ability to manage your finances responsibly.

Get Your Letter of Explanation Template Today

If you need to provide a Letter of Explanation for your mortgage application, our template is an excellent resource to ensure you present a clear, concise, and professional letter. Download the template in DOCX format from BizzLibrary.com and customize it to your needs. The easy-to-use template will save you time and effort in drafting a letter from scratch.

Visit BizzLibrary.com now to access a wide range of business document templates, including mortgage agreements, payment schedules, and more. Make the mortgage process simpler and more secure with BizzLibrary.com!