Letter Of Explanation: Why It’s Important And How To Write One With Your Mortgage Application
Author:
Hanna KielarFeb 22, 2024
•7-minute read
Your lender might ask you for a letter of explanation (sometimes called an LOE) during the underwriting process. A letter of explanation consists of short descriptions you can use to fill in the gaps in your paperwork for your underwriter. Letters of explanation might sound like a pain to write, but they can help you get a loan more easily.
Let’s delve a bit deeper into what letters of explanation are and some reasons you might benefit from writing an LOE. We’ll also provide a letter of explanation sample template you can use to draft your own letter if or when the time comes to write one.
The Basics Of Underwriting
First, it’s important to fully understand the mortgage underwriting process. During this stage of securing a mortgage, the lender decides whether you qualify for a loan by reviewing the financial information you submitted with your application.
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