Help Writing a Letter to a Loan or Bond Company to Explain Credit Problems

A universal truth about financial problems is they just don't go away on their own. If you find yourself in serious trouble because of your spending habits, it's best to take action before your loan or bond company starts to ask you what's going on. If you're truly ready to start fixing your credit problems, you can write a letter to your loan or bond company asking for them to give you a grace period so you can work on repairing the damage before it gets worse.

Instructions

1

Make a list of reasons why you are having credit problems. If you are living beyond your means every month, going on frequent shopping trips, or just not paying attention to what you spend your money on, then you know what you need to stop in order to fix your credit.

2

Make a plan to stop damaging your credit. For example, you can decide to stop using your credit cards to go shopping or you can budget extra money to pay down debt.

3

Set up your letter so it's in a professional format. The paper should be letter-sized, 8 1/2 by 11 inches and there should be 1-inch margins all the way around. Use either Arial or Times New Roman font and a 12-point letter size on a word processor.

4

Write the date In the upper left-hand corner. Under that, write your full name. Under that, write your full address. Skip a line and write the full name and address of the loan or bond company to whom you are writing. Skip a line and write the greeting "Dear Sir or Madam:"

5

Skip a line under the greeting and begin the letter by explaining why you are having financial problems. Be honest and resist the temptation to lie. In the first paragraph, write no more than 10 sentences detailing why you cannot pay off your loan. In the next paragraph, write no more than 10 sentences explaining exactly what your plan is to fix your credit problems so you can pay them. Keep your sentences short and factual.

6

Keep the last paragraph short (around three to four sentences). Let the company know what you want them to do to help you. For example, you may ask them to deffer your payments for a month or two, or you may want to negotiate a reduced monthly payment with them. You can ask for a reduced finance rate as well. But whatever you want from them, be specific.

7

End your letter with "Sincerely,", skip three lines, and type your full name. Print the letter off and sign the space between "Sincerely" and your typed name with a black ink pen.