The City of San José processes requests for payoff demands of existing homebuyer and home repair loans, and affordability restrictions (i.e. A letter of explanation is your chance to answer any questions a lender might have about your loan application.Creating a payoff letter is essential to any loan or mortgage repayment process. Our free templates and this guide can help you get started. The letter is a request from Emma Baluyot to settle her debt with Althea Financing for 150,000 pesos. 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 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.