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Letter of Explanation for Cash out Refinance Template
A L etter of Explanation for Cash Out Refinance is a document that individuals can use when they want to explain to their potential lender why they need cash out refinancing. The purpose of the document is to convince your prospective new lender to agree to give you a new loan with different conditions that will replace your old loan.
A cash out refinance can help individuals to decrease the sum of their monthly payments by getting a new loan that will pay off their previous loan. This way they will have a new installment plan with smaller monthly payments and more money to work with.
Generally, this letter is prepared by the borrower and submitted to their prospective new lender. Considering the fact that this letter can affect your future financial situation, you should carefully choose what to mention there and what to avoid. A Letter of Explanation for a Cash Out Refinance template can be downloaded below.
When you write the letter, you should try to explain to your potential new lender why you need to cash out and how it will affect your current financial situation. In order to validate the information provided in the letter, you can attach different financial documents that verify your expenses (medical bills, home improvements, tuition, etc.).
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