1. In the sample letter, fill in your personal information. Provide a clear explanation: Your letter should acknowledge and indicate why something happened.Address the letter directly to the lender or the person who requested it. We have now written 7 letters for the purpose of explaining recent credit inquiries. Apparently, the wording we have used is unacceptable. Mortgage lenders might request a letter of explanation for various red flags that come up in underwriting. Learn how to write one, and download a template. See a sample Answer Form for Consumer Credit Transaction. A letter of explanation is your chance to answer any questions a lender might have about your loan application. Use this sample letter to dispute mistakes on your credit report.