The ABCs of Writing a Letter of Explanation for a Mortgage. Fortunately, when your loan officer or an underwriter requests a letter of explanation, it doesn’t have to be a big stress moment. It’s common for mortgage underwriters to ask for a written explanation for certain situations or problem areas in your credit history, employment or other areas.

That information can come in a form of a Letter of Explanation. These letters are then retained in case the Government or another Underwriter has to review the file. Missing or incomplete files.

How to Write a Letter of Explanation. Address the letter to your mortgage loan officer or the mortgage company according to your loan officer’s instructions. Limit your explanation to facts and dates. Avoid any temptation to place blame or rant about anything or anyone involved in the situation you’re addressing.

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How To Write A Good Letter Of Explanation To Conditions Underwriters Request Bankruptcy. Mortgage Loan modifications. foreclosure. delinquent credit payment History. Recent Job Change. Divorce. Identity theft. child support. common names, or relative appearing as you. High Charge Card.

A letter of explanation (LOE) is a fairly common occurrence in the mortgage underwriting world, and they’re not always a bad thing. Lenders and underwriters sometimes ask for these letters in order to document something, to obtain more information, and to satisfy the requirements imposed by FHA, VA, Freddie Mac, etc.

A Letter of Explanation is a simple few lines giving an underwriter insight into something flagged in the file such as odd deposits or credit issues.

The Financial Ombudsman Service has told mortgage lenders in at least two cases to extend interest-only terms indefinitely for older. received a letter from her mortgage company explaining her.

How Long Are Hard Inquiries On Your Credit Hard inquiries stay on your credit for 2 years. However, that doesn’t mean a hard inquiry negatively affects your credit for 2 years. Rather, a hard inquiry will only affect your credit for up to 12 months. Even then, hard inquiries only hurt your credit if you have several.

So the lender creates another condition based on this information, requiring a letter of explanation about declining income. In short, conditions brought on by a mortgage underwriting can create more.

The wonder doesn’t stop at my immediate circle; even the underwriters for my mortgage asked me to write a letter of explanation. The Big Apple has its charms, I will not deny that – but it is not home.