Credit Denial Letter Template

A Credit Denial Letter is a written document prepared by the financial institution (a bank or a building society) that has received a Credit Application from an individual or organization and needs to reject it.

Whether the potential creditor was unhappy with the negative items they discovered in the applicant's credit report, they were not provided with enough information to make an informed decision, or the credit history of the prospective borrower contained unclear details, it is within the creditor's rights to deny the credit yet explain to the person or company that requested it their reasoning. Download a printable Credit Denial Letter template through the link below.

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How to Write a Credit Denial Letter?

Make sure that your Denial of Credit Letter includes the following parts.

  1. Introduction. Indicate who you are addressing. Enter the credit applicant's name, full address, telephone number, and email. The address can include their ZIP code, state, city, street name, and building number.
  2. Information About the Denial. Announce that the Credit Application was denied. Provide information about which application was denied by stating its date and number (if applicable). If you are willing to reconsider the decision you have made, can state that and explain what the credit applicant should do to meet your criteria. For example, you can request additional documents and state the time period during which the credit applicant should submit those documents.
  3. Reasons for Denial. Use this part of the letter to designate the reason (or list reasons, if there are more than one) why the Credit Application has been denied. It can include reasons such as insufficient credit references, delinquent credit obligations, poor tax records, bankruptcy, incorrect financial details, etc.
  4. Additional Information. If you conducted a screening of the credit applicant, you can provide information on what agency has made a report. Attach a copy to the letter or offer the applicant to request a copy from them.
  5. Contact Information. Provide your contact information, in case the credit applicant will have any questions. Provide the name of the person to contact, their email, telephone number, and postal address (if applicable).
  6. Conclusion. Thank the credit applicant for addressing you and express appreciation of the applicant's interest. Say that you regret the denial of the application, and hope to work with the credit applicant if they apply for credit again in the future.

A Credit Application Denial Letter can include other parts as well. Its content will depend on the specifics of the situation and on what a prospective lender would consider as valuable information to share.

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Download Credit Denial Letter Template

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Credit Denial Letter Template preview - TD Bank

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