Letter of Explanation for Credit Problems [FREE Sample]

Learn how to write a letter of explanation for credit problems. Use our sample letter of explanation for credit problems as a template for your letter.

Sample Letter Of Explanation For Credit Problems

Name of Consumer
Address of Consumer
City, State, Zip Code

DATE

Name of Lender
Address of Lender
City, State, Zip Code

RE: Explanation for late payments on credit report

Dear Name of Lender:

This letter is in reference to my application for a loan of $10,000 to purchase a new car. I understand that my credit rating is low and the purpose of this letter to explain the reason for this, and how I have remedied my financial situation.

On DATE, the company I worked for laid off 200 employees including myself. During the exit interview, I was told it was because the company needed to reduce spending due to the economic downturn.

I was in good standing with the company and was given a letter of recommendation from my supervisor. Because of the economic situation, I was unable to get another job until DATE.

During the time I was out of work, my family lived on my wife’s salary. We were unable to make payments on our credit cards and mortgage.

Since I got my new job, we have resumed payments on all of our debts and plan to pay them off. 

Now, I require a car for my new job and would like an auto loan. I will be able to make the payments every month.

Thank you for considering my situation. If you have any questions, I can be reached at Phone Number or Email Address.

Sincerely,

Signature of Consumer
Printed Name of Consumer
List of Enclosures: Copies of letter of leaving the job, recommendation from supervisor and hiring letter for a new job

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