Creating a payoff letter is essential to any loan or mortgage repayment process. Our free templates and this guide can help you get started.A payoff letter shows the remaining balance on your mortgage, including fees, interest, etc. Learn more about what a payoff quote is and how to request one. A payoff letter provides instructions on how to pay off a loan with a lump sum before the loan term ends. Learn how payoff letters work. Request a payoff quote. PRINT AND FILL OUT THIS FORM - Please complete all relevant sections of the Payoff. Mortgage lenders ask for a letter of explanation to better understand your finances when determining whether to approve you for a loan. If you receive this form in a small claims case, contact a lawyer.