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 mortgage payoff letter can come in two forms. One form tells borrowers the remaining principal amount and interest they have to pay to close out the loan. Create a Loan Payoff Letter online and download it as a PDF or Word document. Customize and print a blank Loan Payoff Letter for free. Create a Loan Payoff Letter online and download it as a PDF or Word document. Customize and print a blank Loan Payoff Letter for free. Mortgage payoff letters create many uncertainties for title company escrow officers. This section sets out the requirements for an escrow account that a lender establishes in connection with a federally related mortgage loan.