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How should I describe credit default in a mortgage letter of explanation?

I have two instances of missed payments on my credit report in the last two years and both of them were right around my divorce. I don't know how to put these in the letter of explanation I've been asked to write by the mortgage company I'm using. Do I just explain the divorce and my financial hardship or will that look whiny and compromise my chances for approval? Please help by kathdrewery8643479 from Centereach, New York. Jul 8th 2014 Reply


Kofi Akpabla (KofiAkpabla)
#22 ranked lender in Connecticut - 37 contributions

Your loan originator should help you with this. Just be honest. Usually the bank just wants to see that this was a one time thing. Just explain what happened. It will not compromise your chase at approval. Let me know if you need help! kakpabla@warshawcapital.com. Good luck!

Jul 8th 2014
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Phil Dumouchel (PhilDu)
#32 ranked lender in South Carolina - 2,240 contributions

I agree, a good loan officer will usually help you. Just be honest - they don't want an essay, they want to know why it happened and feel confident it isn't likely to happen again after they make you a new loan. Best wishes!

Jul 8th 2014
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Yvonne Lutz (YvonneLutz)
#119 ranked lender in New York - 11 contributions

Just explain honestly what happened. A letter of explanation is a very common request from a lender, don't let it make you nervous. Two late payments usually don't have a huge impact on your chances unless it is coming after a recent bankruptcy. Your loan officer will help you write a good letter of explanation. Good luck.

Jul 8th 2014
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Steven Ceceri (CreativeFinancingOptionsGroup)
#36 ranked lender in Massachusetts - 723 contributions

If the issues are based on divorce, you'll need to describe why you were late, such as taking time off of work (unpaid), etc. Check with your loan officer as to what they are really looking for as he/she should be able to guide you best.

Jul 8th 2014
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Joe Metzler (JoeMetzler)
#1 ranked lender in Minnesota - 3,930 contributions

Be honest... What we are looking for is that hopefully it was a one time situation beyond your control, and that the situation has been taken care of, and unlikely to happen again.

Jul 8th 2014
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