Loan Confirmation Letter Sample

What is a loan confirmation and how to write a letter?

A loan confirmation letter is a document from the bank or a financial institution stating that the client has an approved loan or that they have the qualifications to apply for one.

Why would you need one?

The purpose of the letter is to provide a guarantee to a seller that they are capable of paying a certain amount of money in return of goods or services (house, car, etc.. ).

The letter does not put any legal obligations on the financial institution especially in cases where the maximum amount of funds that can be borrowed is less than the cost of the products.

How to write a loan cinfirmation letter?

  • Address the seller by name. Refrain from using the "to whom it may concern". A malicious client may present the same letter to multiple sellers.

  • Identify the client clearly by name and account number

  • State the client's ability to borrow money.

  • Mention clearly the maximum amount of funds that can be loaned.

  • Relegate the bank from any legal obligations

  • Optionally, place an expiry date on the letter.

Let us examine a sample letter based on the points discussed above.

To: [Seller Name]

This letter is to confirm that Mr. ________, who is client of _________ bank with accoint number _______ is eligible for a loan of amount not exceeding $100,000.

This letter is valid for 90 days from the issuing date. This letter has been issued upon the request of Mr _______ with no legal obligations to the bank.


Loan Confirmation Letter Sample