What is a letter of explanation for derogatory credit for mortgage?

The letter of explanation addresses red flags that might derail your approval: why you were unemployed for a period of time or why there's an unpaid balance on your credit report. Not every borrower needs to write a letter of explanation. If you do, your lender will request one.

How do you explain derogatory accounts?

There are multiple reasons why you may have received a derogatory remark on your credit score. This could be because you've missed payments, filed for bankruptcy, haven't paid your debt or even because of an error. Depending on the type of remark, you can file a dispute or request a removal.

How to write a letter explaining derogatory credit?

Letters of explanation addressing these issues should include: An explanation of the negative event. The date it happened. The name of the creditor. Your account number. Your signature and date (if typed or hand-written)

How do I write a letter of explanation for a mortgage credit inquiries?

Provide a clear explanation: Your letter should acknowledge and indicate why something happened. If, for instance, you fell behind on loan payments in the past or were out of work for a significant period of time, explain the extenuating circumstances.

Is there a free AI to help write a letter?

Grammarly's letter-writing tool uses AI to help you create a personalized letter in seconds. You don't need to be an expert at writing letters to use it. Just outline the key details of your letter, and the AI letter writer generator will take care of the rest.

How do you write a strong letter of explanation?

It's best when writing a letter of explanation to make it short and to the point. You'll want it to provide the recipient with the information they need, however. Be clear and offer as much relevant detail as possible since the person reading the letter will need to understand your situation.

How to create an explanation letter?

How to write an explanation letter in 3 steps Choose letter format. Clients, team members or students may use print or email for their letters. Explain the situation. To begin writing this type of letter, you might explain the situation or circumstance and any contributing factors. Take responsibility and accountability.

What is a letter of explanation for mortgage?

A letter of explanation clarifies negative marks on your credit report and assures an underwriter or lender that you are capable of paying off a mortgage.

Home
Functionality index

Draft personalized letters with Letter of Explanation creator solution

Drop document here to upload

Up to 100 MB for PDF and up to 25 MB for DOC, DOCX, RTF, PPT, PPTX, JPEG, PNG, JFIF, XLS, XLSX or TXT

Based on 12500+ reviews

Last updated on Jan 1, 2026

Document creation is just the beginning

Learn more about security

Create and edit documents with a trusted solution

Try easy-to-use tools for all your document management needs.

Upload your document

pdfFiller scores top ratings on review platforms

So far, I really like PDFfiller and have used it to edit several documents that I needed to revised for others but previously could only leave comments for users. Using PDFfiller has made me so much more productive.

Y Hobson

It is easy to use and there is no watermark which is really great when it is something that I am going to have to turn in professionally. They do a great job of making the pdf to write in

Alex H

What do you like best?
We have been using PDF filler since 2015 I believe. We love it! Its very user friendly and affordable.
What do you dislike?
The customization when sending e-signature documents is very limited.
Recommendations to others considering the product:
Go for it. Very easy to use and more affordable the other comparable solutions.
What problems are you solving with the product? What benefits have you realized?
great way to get documents signed digitally

Administrator in Consumer Electronics

I like that I can create a fillable PDF… I like that I can create a fillable PDF and merge documents together. This program has a lot of good features that other companies don't offer.

Susan M.

Excellent customer service! I used the pdfFiller when I had no access to a printer- it was efficient and easy to use. However this was a one off and thought I had cancelled my subscription. When I saw I was being charged I was concerned as I have no need for the service on a subscription, however I contacted pdfFiller customer services explaining my situation and I received a very reassuring reply from Max and the pending transaction was cancelled immediately. If I ever need the service again I wouldn’t hesitate to use pdfFiller or recommend them. Outstanding customer service.

Kirsty Shearer

I initially thought that PDFfiller was a free tool. Even though they asked me for my credit card information with a free 30 Day trial I forgot about the same. When I got an email a month later stating I had been charged for the whole year I logged in and chatted with Customer Service. They were so kind as to immediately understand, cancel my subscription, and agree to issue me a refund. At the time of writing this, I am still awaiting my refund as I just requested the cancellation today - but I must say that this gesture was amazing by PDFfiller and this review is the very least I can do. Thank you for brightening up 2020 a bit! Amazing business ethic and professional courtesy.

Rakesh R

Show more Show less

Watch pdfFiller eSignatures in action

Check out a quick video tutorial that shows how to create and place your signature or send a document for signing.

Related features

List of extra features

FAQs

If you can't find what you're looking for, please contact us anytime!

Contact Support

Create and edit documents with a trusted solution

Try easy-to-use tools for all your document management needs.

Upload your document