letter for late pays for mortgage

Discussion in 'Credit Talk' started by becky20, Sep 5, 2003.

  1. becky20

    becky20 Member

    Hi everyone,

    Have an urgent question if anyone can help...

    I have applied for a mortgage with my husband, and just got notice from the lender that there are three late pays on credit cards less than a year old (Cap One in 3/03, Sears in 10/02, Citibank in 11/02). He said they were denying us based on this, but with a good explanation letter, he can resubmit, and if I get him the letter within the next hour he can possibly have an answer today. We're looking to close in 2 weeks so this is urgent...

    To be honest, I don't know why they weren't paid other than an oversight (which is not a good explanation). All were very low payments ($10-$20 on Cap One and Sears and $80 on Citibank).

    Anyone have advice for me????

  2. becky20

    becky20 Member

    Can anyone look at this draft I made and give me your opinion on if this letter is okay for explaining these lates....

    To Whom It May Concern:

    I sincerely thank you for considering my husband and I for a mortgage. We are very excited about this home that weâ??re trying to purchase, and we envision ourselves living in this home for years, and possibly starting a family there in several years.

    I am writing this letter to explain some late payments that are on my credit report in late 2002 and early 2003. First of all, let me apologize for not being more responsible in these payments. At the end of 2002 (late September), my husband and I sold our home in Illinois and my husband moved with our family pet to Arizona, while I stayed in Illinois with family to settle some prior work commitments. During the months of October and November, things were very hectic with getting my husband settled in Arizona and dealing with a long-distance move, coordinating movers, locating a storage facility, and having my husbandâ??s vehicle transported from Illinois to Arizona. I was negligent in getting my mail forwarded, which resulted in my Sears and Citibank credit card payments being delinquent. I didnâ??t realize that I hadnâ??t received my bill until I received notice that it was 30 days late. The issue was not the lack of funds â?? the payments were fairly low ($20 for Sears and $100 for Citibank). It was simply overlooked during the chaos of a long distance move.

    The third payment that was late, Capital One in March 2003, was due to a problem with our internet connection. I always pay my Capital One bill via the internet. We had recently gotten our computer hooked up, and I submitted my payment online (or so I thought). It turned out that the payment had not gone through, and I also did not find out that the payment was never processed until it was past the 30 day late mark. Again, lack of funds was not the issue, as the payment was less than $20.

    During this home buying experience, I have come to realize how much irresponsibility with finances affects our daily lives. Being irresponsible with our payments caused our credit scores to be on the low end, which can cause us several hundred dollars a month in higher interest rates on loans and credit cards. Since the time of these late payments, I have come up with a system which logs each bill when it is received, due date, amount of payment, and I put these dates in my calendar on my computer so it prompts me a week before the due date to mail the payment. I also have logged the payments that I should be receiving on a monthly basis so I will be immediately aware if I do not receive a bill that I am expecting. I feel that these changes in my system will make me more responsible in respect to paying our bills on time, and keep our credit reports clean from this point forward.

    I sincerely hope you will reconsider us for a loan. We look forward to proving to you that we are now responsible consumers and will be on time with our payments for our mortgage as well as all our other debts.

  3. SoParkDiva

    SoParkDiva Well-Known Member

    Didn't you look at your reports before applying? You should be above board with your lender and work with him/her to help you by revealing any past dlinquent debts.

    What is your middle score (that's the score the lender is looking at). If it is low (500's) that may be the real reason the lender is not touching you. That combined with your shaky payment history makes you a very high risk.

    Your letter is a little too personal and long. You might want to edit it and remove the personal stuff. Make it short and to the point.

    If they deny you there are other lenders out there willing to work with you but the rates will probably be higher.
  4. becky20

    becky20 Member

    I've already heard the lecture on not checking my reports first, that's not the point. Time was of the essence and we had to jump on a deal. I have tried several times to get lates removed with little luck, so I think it would've taken several months, if not half a year, to the problem (recent - about 6-8 months ago) removed.

    My mid score is 597 and my husband's is 624. Our debt to ratio is outstanding (less than 12% debt to inccome, and including the future house payment, 36%).

    My lender sent me an email after I sent him the letters and he said they were probably the best he's seen, and another forum I posted the letters said they were phenemonal as well. I learned my lesson about the late payments as well as about not continually working on repairing my credit so it wouldn't be as bad as it is, but in the meantime, I just wanted advice on the letter.

  5. Nestea

    Nestea Well-Known Member

    the letter is excellent!!

    as I told you earlier, it should be added as a template :)
  6. SoParkDiva

    SoParkDiva Well-Known Member

    Mortgage lenders would be out of business if they ignored red flags and just accepted nice letters from everybody with shaky credit histories :)
  7. jlynn

    jlynn Well-Known Member

    As a RE agent that dealt with this, underwriters LOVE this type of letter :)

    Good luck! I hope they approve you.
  8. becky20

    becky20 Member

    Thanks so much to everyone for the vote of confidence on this letter. I'm feeling slightly better about our chances after getting so much good feedback. On another positive note, the mortgage lender that I sent it to (he forwarded it to the underwriters) also told me that it was an excellent letter, one of the best he's seen... So now all I can do is sit and wait, and hope, and pray...

    I'll be sure to post back when I hear!
  9. MaggieQ

    MaggieQ Member

    Hey Becky---Good luck. Your letter was great! Please let us know how it works out!
  10. Nestea

    Nestea Well-Known Member


    I love your style. do you have any other letter;s you have written that you can share for template use?

    Nestea <> BHMH
  11. becky20

    becky20 Member

    Thanks to everyone! My mortgage person said that as long as our rental history comes back okay, and we do a home buyers education class, we're approved!!!! I'm SOOO excited!!!!!

    Thanks to you all!
  12. jlynn

    jlynn Well-Known Member

    Doing the happy dance for you!
  13. becky20

    becky20 Member

    Wow, thanks for the compliment! I actually don't normally write letters, but if I come across a situation where I think a letter might be a good template for someone here, I'll be sure to post it!
  14. MaggieQ

    MaggieQ Member


    I am really happy for you!
  15. Nestea

    Nestea Well-Known Member

    good for ya!!! Congrats!!!

    Happy to know that I liked it first ;-)

    BHMH <> Nestea

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