It is believed that the temple has been built on the very spot where Tulsidas had a vision of Hanuman.Sankat Mochan Temple was founded by Tulsidas who was the author of the Ramacharitamanasa, which is the greatest version of lord Ram story written in Avadhi ("Most of the people having confusion that Ramacharitamanasa is a avadhi version of Valmiki Ramayana but Ramacharitamanasa is different from Sanskrit Ramayana written by rishi Valmiki as Baba Tulsidas Ji already told in Ramacharitamanasa that "Nana bhanti Ram avatara, Ramayan sat koti apara" means in each Kalp lord Ram takes Avatar & plays different-2 lilas(Act) so we have different stories of same lord Ram").
Tradition promises that regular visitors to the temple will gain the special favor of Lord Hanuman. Every Tuesday and Saturday thousands of people queue up in front of the temple to offer prayers to Lord Hanuman. According to Vedic Astrology, Hanuman saves human beings from the anger of the planet Shani (Saturn), and especially people who have an ill-placed Saturn in their horoscopes visit this temple for astrological remedies.
This is supposed to be the most effective way for appeasing Shani. While it is suggested that Hanuman did not hesitate to engulfs in his mouth the sun, the lord of all planets, which humbled all the gods and angels, making them worship him for the Sun's release. Some astrologers believe that worshiping Hanuman can neutralize the ill-effect of Mangal (Mars) and practically any planet that has an ill effect on human life.
It is believed that Tulsidas is believed to have written most of the verses of Ramacharitramanas in this temple.