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.A 10day payoff refers to the time it takes for your new lender to pay off your old loans during a refinance. Creating a payoff letter is essential to any loan or mortgage repayment process. Our free templates and this guide can help you get started. All they need to do is update your credit report in a timely manor. This article provides a template for a debt settlement proposal letter and explains what a debt settlement letter should contain. 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. This article provides a template for a debt settlement proposal letter and explains what a debt settlement letter should contain.