Motivational (motivation, interest) letter for a mortgage is a written expose by the borrower or loan taker addressed to the loan giver, bank, real estate broker, accountant or any kind of institution with purpose to support the mortgage application. Nowadays more and more banks listed this kind of motivation letter in order to prevail its own clients to take more loans than needed and to stop misusage of the Bank’s founds, since 2005 many people bought their homes but they never intended to occupy its own houses/flats/condos and instead they quickly sold the real estate for profit.
Now, many banks require an essay which will provide detailed description of the applicant’s intention while s/he is seeking for a credit. That motivational letter should contain the client’s motivation to buy that specific property, will all the chronological details described narrative:
– What is the intentions of the buyer with the property,
– Why s/he love the property,
– How s/he will take care of the place,
– How many kids are planning to have at that specific property.
In some cases the letter can contain plans for the future changes of the “size of the property”, family history of owning a real estate or how the owner feels about the community surrounding the property. Even thought this requirement disobeys the Fair Housing Act, and in some cases is against the law, in many cases loan takes are not the ones to be questioned. Their feelings and emotions about sharing the marital history, sex preference or pregnancy questions are irrelevant in this situation. They should do as they told.
Despite the fact of justification of the Bank’s intention, without questioning, the letter should be narrow, no longer that one page, containing all the above mentioned details. It will be useful if it is express your short description for loan motivation, like your credit history or explanation of the situation caused you pay late was not in your hands. Besides the motivation and intention of the buyer, a good motivational letter is desirable to include answers to the questions like: Are you moving within the neighborhood to downsize or to move up? Are you planning to live at the property, rent it or sell? What is the intention, or what happened with the home you family previously lived in? Answers to this kind of questions will be a perfect addition to the content mentioned above. In principle the loan officer in not asking too much, s/he wants to make sure that you will pay for the credit and you will not use the property in good manner.
Useful tip: Use everything that you think that is logical to persuade the Bank that you will live at the property you buying. Well known reasons could include nicer neighborhood, more rooms, closer to school or work location, away from industry or farms. Typically, lender is not interested in your family situation as long as it not concerns you credit ability.