What is a Letter of Intent for mortgage?
Subsequently, one may also ask, what is a letter of explanation for mortgage?
A letter of explanation is your opportunity to explain to the lender in detail why there are negative marks on your credit. It's designed to give the lender a better sense of your current financial situation as well as any past circumstances that caused damage to your credit score.
One may also ask, what is a Letter of Intent for loan? A proposal letter (or letter of intent) is an expression of interest from the lender before credit approval is obtained. A commitment letter evidences the lender's commitment to lend and is only furnished after credit approval.
Simply so, what is a letter of intent when buying a house?
Before you submit an offer to purchase a house, you can approach a seller with a letter of intent. It usually proposes sale terms, such as price, closing date, inspection plans and financing. Letters of intent don't bind the buyer or seller to negotiate further or make a binding sale contract.
Why do underwriters ask for letters of explanation?
The lender and their underwriter are asking the borrower to explain something. They want the letter, or sometimes letters, of explanation in order to cover all of their bases and make sure that the information they are using to make an approval determination is as complete and thorough as possible.