Sample Letter of Explanation for Cash out Refinance

What Is a Cash-Out Refinance Letter?

A Cash-Out Refinance Letter is a formal request drafted by a mortgage borrower who is looking to use the equity they have built for their advantage and replace their old mortgage with a new one, receiving a sum of money to invest in remodeling, repay accumulated debts, or handle other financial issues. To convince the mortgage company to let you improve the terms of the home loan, you have to elaborate on your plans and prove you have built up enough equity in your house to justify a potential refinancing.

A sample Letter of Explanation for Cash-Out Refinance can be downloaded below.

Here's what you'll need to write your own letter:

1. Greet the lender and introduce yourself, write down your mailing address.
2. Include a reference to the mortgage agreement you have signed with the letter recipient, certify your intent to seek cash-out refinance, explain why do you choose to obtain money this way instead of taking out an additional loan, and indicate your contact information.
3. Attach bank statements that show your current financial situation and a note from the credit bureau that demonstrates your credit score to strengthen your case.

Haven't found what you were looking for? Check out these letter templates:

• Letter of Explanation for Mortgage Refinance;
• Letter of Explanation for Cash Out Refinance;
• Mortgage Pre-Approval Letter.