THE IMPORTANCE OF A HARDSHIP LETTER
Webster tells us that "hardship" is "something that causes suffering or deprivation." Using that definition, most of us are suffering some form of hardship during the current difficult economy. But wait a minute a "hardship letter"? Where would we send it and who would read it? Questions without answers, right?
Fortunately a true hardship letter is directed to someone who will read it - the lender. And, a hardship letter services an important purpose. For those struggling to make mortgage payments or, even worse, facing the foreclosure of a home, this letter is an absolutely necessary tool. For borrowers seeking mortgage loan modification, a forbearance agreement or a short sale, the hardship letter is a lender requirement. Not only is the hardship letter required by the lender, it is the most important part of the borrower's appeal. The borrower is requesting the lender take a course of action - an action suggested by the borrower. The hardship letter will bring your situation and request to the lender's attention. It is critical to your success that the tone of the letter and the facts within the letter make the right first impression. It is essential that the letter contain honest facts and verifiable details.
Contents at a Glance
IF YOU ARE HAVING FINANCIAL PROBLEMS A HARDSHIP LETTER MAY HELP
You can prepare a hardship letter for any lender - mortgage, car loan, boat loan, credit cards, etc. It may convince the lender to workout the situation with you. This may salvage your credit and your possessions. At least give it a try.
VALID HARDSHIPS
BE SPECIFIC, BE HONEST
Not all hardships are created equal in the eyes of the lender. Some examples that will be given serious consideration: Adjustable Rate Mortgage reset with excessive increase in payments, reduced income due to job loss or pay cut, death of spouse or major medical bills. There are other unforeseen events that created a financial hardship that lenders may find legitimate and reasonable. Regardless of the problem, you must be specific and provide supporting documentation with the letter. If you are requesting a mortgage loan modification and you can assure the lender (with written evidence) that you can make reduced mortgage payments, your chance of approval increases. On the other hand, if you quit a job because you didn't like the boss (even if he was a jerk!) and now you are unemployed, the lender may frown on your request for assistance. Above all, as you explain the hardship, be honest.
NEED MORE INFORMATION TO STOP FORECLOSURE
HELP WITH YOUR HARDSHIP LETTER
SEE WHAT EXPERTS HAVE TO SAY
WRITING THE HARDSHIP LETTER
GIVE THIS LETTER TIME AND ATTENTION
As you write the hardship letter, be sure your tone is polite, financial information accurate and you propose a solution to the problem, i.e. mortgage loan modification, forbearance agreement, short sale. If you are requesting a mortgage modification, be sure you have the ability to make the reduced payments. The lender has no interest in owning your home, but the lender needs to be convinced that your proposed solution will be a permanent resolution. Be sure you close the letter by thanking the lender for their time and anticipated cooperation. There are numerous samples of hardship letters available, some free and some for a fee. Here's one example:
NEED HELP? CHECK THIS OUT:
SAMPLE HARDSHIP LETTER
Before you send the letter, read it out loud and run spell check. This letter needs to represent your best work.
ALTERNATIVES TO FORECLOSURE
DO IT YOURSELF MORTGAGE LOAN MODIFICATION
CHECK THIS OUT:
EVERYTHING YOU NEED FOR A SUCCESSFUL MORTGAGE MODIFICATION
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directcapital
Nov 29, 2011 @ 2:13 am | delete
- Thanks for Great post. I really like this article.
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