Generally, fashionable people wait until late in the fall to move back to New York City, but this year Lily returns in October, just a couple of weeks after her boring aunt returns from her own vacation. Lily has not received as many invitations this year as she normally does—a sign that everyone is bored with her. She has an open invitation to visit the Trenors at Bellomont, but she avoids going there because she does not know what Mr. Trenor may demand in exchange for his investment help.

On her first day home, Lily receives a visit from Mrs. Haffen, the maid who saw her coming out of Selden's house several weeks earlier. Mrs. Haffen asks to speak to Lily in the drawing room. Sensing that something strange is going on, Lily ushers the woman in. Mrs. Haffen produces a stack of love letters from Selden’s garbage can and offers to sell them to Lily. It is clear that Mrs. Haffen believes Lily to be the writer of the letters, but one glance at the writing proves that they were written by Mrs. Dorset. Lily’s first reaction is disgust; never before has she been approached with such a horrible offer. She almost sends Mrs. Haffen away, but then she realizes that it will hurt Selden if the letters become public. They are clearly unsafe in Mrs. Haffen’s hands; Lily buys them and resolves to destroy them.

Soon after Lily finishes this unsettling conversation, Mrs. Peniston comes home and asks to hear about Jack Stepney’s wedding. Lily does not remember the fussy details of décor that her aunt wants to know, so the conversation soon turns elsewhere. To Lily’s dismay, Mrs. Peniston brings up Mr. Gryce. Although Mrs. Peniston rarely spends any time with fashionable people, she is wealthy and connected to the flow of gossip about Lily’s social circle. Thus she has heard that Mr. Gryce is marrying Miss Van Osburgh and that many people previously thought he would marry Lily instead.

Upset by this allusion to her recent failure, Lily excuses herself for bed. She goes to her room and reflects on its dingy appearance. If she had married Mr. Gryce, she would have had a chance to get out of this life in which nothing belongs to her and nothing is under her control. As it is, the chance is lost. Lily glosses over the memory of her own mistakes. Instead she focuses on Mrs. Dorset’s role in frightening Mr. Gryce away. With this in mind, Lily refrains from burning the scandalous letters. Instead she packs them away to keep.