Trust me if you LOVE monograms....you will want to read on....
I read how to do this originally on Neither Hip Nor Funky.
You use Plain old Freezer Paper that you buy at the grocery store. I printed the letter I wanted, cut it out, traced it on the dull side of the freezer paper and cut out the inside. Lots of cutting, but worth it.
I positioned it on the fabric, and pressed onto fabric. TIP #1 : Be sure your iron DOES NOT have water in it! TIP #2: If you do not like the placement after it is pressed you CAN remove the pattern and press again. You can do this up to 4 times!
Use regular acrylic paint mixed with Textile Medium and Paint! Do not use brush strokes...dab going up and down if you use brush strokes it can get under the paper! I waited until the paint was slightly dry to pull off. Here is the results. Perfect crisp lines!