Sample Hardship Letter: If you find yourself in a difficult real estate situation where your home and loan is upside-down, don’t fret, a short sale might just be the answer to help cure your mortgage woes. In today’s market, it is imperative that you take a step back from all of the noise to reflect upon your situation. At each point in your financial history, you made decisions that you believed would best help you realize your goals. Because nobody has perfect foresight into their future income status, or the property market generally, it is only natural to re-evaluate your current debt situation when things change unexpectedly. One option for home owners is short sale negotiations, which may allow you to sell your home to satisfy the existing loan.
First and foremost, it’s important that you act as your own primary advocate in this situation. Put your best foot forward because short sales only work when fully agreed to by both the borrower and the lender (your mortgage holder). Understand that, given today’s extraordinary market environment, even high profile individuals are often in a position where there is a gap between what they can afford and what they believed they could afford in the future. Take the case of well-known TV personality Ed McMahon: his Beverly Hills home faced foreclosure due to unexpected changes in property value, interest rates and his own personal income (see Business Week).
In order to satisfy the requirements of the home loan, Mr. McMahon has been working to reach an agreement with a third party to clear a short sale to satisfy his mortgage. Like Mr. McMahon, you may find it initially difficult to find a market clearing transaction to satisfy your lender, but remember: just as hard work and persistence allowed you to afford a home in the first place, diligence can help you overcome obstacles to find the best way to address to your current home loan.Sample Hardship Letter
A short sale MUST be accepted by your current lender or servicer in order to proceed with the sale of your home. Short sales are considered a privilege and not a right. So, with that said, you must be prepared to provide proof and evidence that you qualify and deserve a short sale by your lender. Getting a lender to approve a short sale is primarily a question of economics. You have to provide hard numbers to show that the amount of money a bank will realize on the short sale is better than the amount it may recoup from foreclosing on the property and selling the property.Sample Hardship Letter
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