topic Re: Credit Explanation Letter......PLEASE HELP in Mortgage Loans

Credit Explanation Letter......PLEASE HELP

SCTeach28 — Wed, 21 Apr 2010 00:03:34 GMT

I need your help ASAP. My LO informed me that I needed to write a letter of explanation for 5 accounts on my credit report. All 5 accounts were while I was in college and I honestly didn't know the effect that bad credit can have on someone. After I graduated 2 year ago, I paid all of them. My question is how do I state what I just said in a much professional way. I worked part-time during some of my college years, but not all.

Re: Credit Explanation Letter......PLEASE HELP

wealthygirl — Wed, 21 Apr 2010 16:15:51 GMT

It's perfectly okay to write it just as you explained in your post, doesn't have to be technical/professional in terminology/content. I just completed a Letter of Explanation yesterday and merely stated exactly what issues caused the late payments to one of my creditors, what I did to rectify it, and what I plan to do in order to avoid any late payments in the future.

SAMPLE:

With regard to the late payments to COMPANY XYZ in 03/2009-07/2009, I was unable to make timely payments because of or due to (fill in the blank). (what steps did you take change situation) I took on a second job in order to make extra payments on this account and was able to bring it into good standing by 08/2009. I was able to pay $$$ extra and... (what will you do in the future to prevent this from happening again) I created an account alert to notify me when...

Hope this helps!

Re: Credit Explanation Letter......PLEASE HELP

DallasLoanGuy — Wed, 21 Apr 2010 16:35:41 GMT

1. What happened?

2.How did you deal with it?

3. What steps have you taken since to insure that these things do not happen again.

Re: Credit Explanation Letter......PLEASE HELP

Anonymous — Thu, 22 Apr 2010 12:07:31 GMT

I have a question about that. My lates happened during the same time frame. March 08-June 08 and August 08-October 08. Can I just repeat the explanation for each one or will just one letter explaining the reason behind the lates be sufficient? I don't want to sound like a broken record in the letter, but it all was due to the same reason. Basically I moved back to FL and couldn't find employment, then got a contract job and then laid off from that.

Thanks!

Re: Credit Explanation Letter......PLEASE HELP

hawkeye33 — Thu, 22 Apr 2010 17:59:21 GMT

One explanation referencing both time periods should be sufficient. Don't forget to include something (per Dallas) that gives them a warm fuzzy that you have a plan to prevent it from happening in the future. They want to see that you understand how to manage your money now, better than you did in the past when the lates occurred. Good luck!