A letter of default is the last letter a lender will send you when you have missed payments on a debt before they take supplemental action. If you have been missing payments on your mortgage, your lender will send you a letter of default. They will notify you that if you do not comply with the terms of the letter, they will begin to foreclose on your home. Letters of default are used in other areas as well, but they are most commonly used in home and car loans.

Sample letter of default

Leonard P. Ronk

3174 Duff Avenue
Weybridge, VT 05753

Dear Mr. Ronk

This letter is a formal notification that you are in default of your obligation to make payments on your home loan, account #546234. This current account holds the sum of $5,000, payable by July 1^st, 2009.

This amount has been overdue since April 1^st, 2009 and you have ignored multiple requests to make a payment or reconsolidate your debt.

Unless the full amount ($5,000) is received within 15 days, we have no choice but to begin the foreclosure process on your home. We have given you more than adequate notice on this issue, and we have no other choice.

Please act accordingly,

Peach Tree Lending Inc.