Hardship Letter: Credit cards have been a huge problem in this country for years, but remember everything in this life (even credit card debt) is workable. When negotiating your CREDIT CARD DEBT don’t sound to eager to settle, get angry or show hesitation and be calm, professional, polite and firm.

Above all be patient, taking your time and not losing your cool. Creditors know the older your debt gets the harder it is to collect it, so as the days go by they are more likely to cut their losses and settle for anything near what you propose.

When witting your Credit Card Hardship Letter don’t make an offer you cannot afford. Many debts are settled for as little as 7 cents on the dollar. Your opening offer should be no more than 20-25% of the original debt amount – the creditors will counter.

You also need to keep in mind the credit card companies can take legal action against you, if the debt is delinquent for a long period of time.

You’ll want to get all agreements in writing and make sure you have a file of the delivery receipts and a copy of the Hardship Letter.

The bad news is a credit card debt settlement will show up as a negative on your credit report.

Credit Card Hardship Letter Sample

This letter is intended to be used as a first step in negotiating your debt settlement. It is to be used as a guide only. You must delete any information that does not apply to your situation and add your personal information that you feel is needed.

(Date)
(Company’s representative)
(Company’s Name)
(Company’s Address)
(Company’s phone number)

RE: Hardship Letter – Account number: (#)

Dear (Ms/Mr. Robinson:)

Due to my bad financial situation I am writing this letter to request a Settlement of 60 to 70 percent.

Since last (month) my income has dropped considerably due to a (illness, job laid off,…), making it difficult to make full monthly payments.

I am enclosing my financial statements and documents that prove my hardship at the moment. (include any late payments statements, car repossession, past due statements, bank statements,…)

I am trying to avoid Bankruptcy and/or Foreclosure and am currently in negotiation with other creditors with whom I need to make similar arrangements.

I kindly request that you seriously consider my offer. I will mail the payment to your organization within five business days, after I am informed by writing of your decision.

If you wish to discuss this settlement offer, I can be reached at (your daytime phone number with area code).

Sincerely,

(Home Owner Signature)
(Home Owner Name)
(Co-signer Name)
(Home Owner Address)
(Account #)

What am i suppose to do now that im told i cant get a loan mod, what are my options then? Is there still a chance to stop foreclosure if you are denied the choice of loan modification? The answer is most definitely a yes! Let us look at all your other options to put a stop to mortgage foreclosure if you are not eligible for loan modification:

1) Hardship Letter, hardship letter and hardship letter to stop your foreclosure, this is probably the most-used option after the solution of refinancing. If written properly, the hardship letter could be an extremely useful tool to help your creditors understand of your current financial situation, and obtain their sympathy for you to get back on track in terms of mortgage payments. You could either draft out the letter yourself, or get assistance from a legal professional to help you with the letter. The hardship letter has to be attached with the appropriate supporting documents before you meet your creditors for negotiations.

2) Another option to stop foreclosure now is by asking for a foreclosure court hearing, this is a legitimate and legal way that many undertake in order to stay in your home as your work towards staving off foreclosure proceedings and get your finances under control again. There are normally hundreds of cases waiting to be heard in each circuit court in the country, thus when you file your case, you would be required to wait for a duration of a few months to up to two or three years before your case goes to court. That means plenty of time for you to work on your finances and get back on track in terms of mortgage payments.

3) Locate errors within your Housing Closing Contract, and use them to your advantage to get foreclosure proceedings off your back! You could either run through the documents yourself, or get a lawyer to find the errors for you! But hiring someone would mean having to pay him/ her for the service, thus it is best that you do it yourself (as the errors are fairly easy to locate).

As you can see, there are plenty of ways to stop foreclosure as mentioned above. There are also other ways such as filing for bankruptcy, but only explore this option if all other solutions have been depleted.

Hardship: Nearly 300,000 homes a month are going into the first stages of foreclosure. California is one of six states that have been contributing about 60% of the total number of foreclosures since late 2008. Of that number, Florida, Arizona and California are responsible for 44% of the total foreclosure rate nationwide.

California, there are six cities among the top 10 cities nationwide suffering the highest rates of foreclosure. In terms of what this means for foreclosures, it looks as if the state still has a ways to go in order to fully get a handle on stabilizing its hardship foreclosures and increasing revenues from home ownership.

The cities within California, the state has the number three and number four positions (Modesto and Sacramento) while also running the table from five through eight as well. There is no particular region hardest hit, and cities are located in both the southern and northern areas of the state. California is large and diverse, unfortunately because any other state would have been dealt a fatal blow from having so many cities on that list.

California, though, is refusing to quit and is hanging in there and working hard to begin pushing down California foreclosures in the best way it can. The federal government has been assisting by offering a number of different mortgage prevention programs, though a great many citizens in the state bought much more home at the peak of the real estate boom than they probably should have.

These people are now sitting on homes that may have declined by 50% or more in terms of their value. They owe more than a home is worth, in other words, and they quite often took on initially-low and attractive home loans that are now increasing in terms of their monthly payment as interest rates on them have been adjusted upwards. This is helping to exacerbate the rate of California foreclosures as well.

At present, 1 in every 409 homes in the country has begun to enter the first stages of the foreclosure process. In California, that rate is probably somewhat higher, meaning that it will be vital for leaders to stabilize real estate markets as best they can in order to ride out the continuing storm that the recession has caused, especially in California.

Hardship Letter!

There are innumerable benefits and advantages to getting your dream home through CA foreclosures now! You can learn the easy steps to get your CA foreclosure and be in your home quickly!

Hardship Letter: Michael Hill’s story is one like hundereds of sad stories all over the country druing the housing crisis, but finally got the call he’d been waiting for. Congratulations, th rep from JPMorgan Chase said, your trial mortgage modification is approved. Hill’s monthly payment, around $900, would be nearly cut in half.

But there was a problem. Chase had foreclosed on Hill’s home a month earlier, and his family was just days away from eviction.

“I listened to her and then I just said, ‘Well, that sounds good,’ ” Hill recalled. ” ‘Tell me how we’re going to do this, seeing as how you sold the house?’ ” That, he found out, was news to Chase.

Millions of homeowners face foreclosure in the continuing housing crisis, but homeowners often have more than the struggling economy and slumping house prices to worry about: Disorganization within the big banks that service mortgages has made a bad problem worse.

Hill was able to avoid eviction — for now. Chase reversed the sale by paying the man who’d bought the home an extra $19,500 on top of the $86,000 he’d paid at the auction. But other homeowners say they lost their homes because the communication breakdown within the banks was so complete that it led to premature or mistaken foreclosures.

In the worst breakdowns, such as Hill’s, banks — and other companies that service loans — actually work at cross-purposes, with one arm of the company foreclosing on the home while the other offers help. Servicers say such mistakes are rare and result from the high volume of defaults and foreclosures.

The problems happen even among servicers participating in the administration’s $75 billion foreclosure-prevention program. Servicers operating under the year-old program are forbidden from auctioning someone’s home while a modification decision is pending. Hardship Letter.

Hardship Letter: If you didnt know the real estate market has snowballed into what can only be explained as a major one crisus. With unemployment at its peak and people losing jobs, many are finding it difficult to make mortgage payments.

Hence, as foreclosures have become common the Federal government has come up with a program to help homeowners through this crisus. As part of the program, the homeowners are getting the option of revising troubled loans, first on a trial basis and then on a permanent basis. If the homeowner is able to pay the revised loan for three months, then only he gets the opportunity for permanent modification.

Supprisingly, a large majority homeowners who have signed up for the program have not sent in the necessary documents (including their Hardship Letter). This highlights the problems being faced by the government to stem the tide of foreclosures.

There is a program that allows a borrower to pay interest rate of 2 per cent on loans. The borrower can do it for five years. After three installments of temporary modifications, the borrower has to give some documents including a financial Hardship Letter and proof of income.

Even the lenders have not been able to address the foreclosure crisis effectively. This has drawn the flak of House Financial Services Committee. The program was started in March and since then the banks have modified loans of 680,000 people. The numbers are much less than what the administration had set its goal at – 4 million.

Critics observe that the banks are at fault. There is increased anger at lenders and people are asking Obama to adopt a tougher stance. The Treasury Department’s assistant secretary, Herbert Allison said that the government should have adopted strong measures.

He said that lenders who are doing a good job should be appreciated while those who are not should be publicly spoken against.

The bank officials say that there are many factors responsible for this; miscommunication with clients, misunderstanding about requirements and inability to listen to some borrowers. Such explanations prompted House members to come up with more programs to stem the crisis only time will tell if it works..

Sample Hardship Letter: A loan modification is a change to the loan contract which is agreed to by the lender and the homeowner. The lender modifies the existing loan(s) in order to work with the homeowner because of a hardship. The purpose is to help make the loan(s) more affordable. Usually loan modifications are in the form of a rate reduction and/or fixing the rate for a certain period of time. In the past, loan modifications were only utilized when a borrower was delinquent and suffered a hardship such as a job loss, divorce, or illness.

Now, borrowers can obtain modifications from their lender for unaffordable rate adjustments on adjustable rate mortgages. The earlier the homeowner addresses the issue, the better the chances are of negotiating a fixed rate and a payment that is manageable.

Now, borrowers can obtain modifications from their lender for unaffordable rate adjustments on adjustable rate mortgages. The earlier the homeowner addresses the issue, the better the chances are of negotiating a fixed rate and a payment that is manageable. Sample Hardship Letter

The following are a sample of hardships that get loan modifications approved:

1. Adjustable Rate Mortgage Reset-Payment Shock

2. Illness of the Borrower

3. Illness of a Borrowers Family Member

4. Curtailment of Income

5. Loss of Job

6. Abandonment of Property

7. Property Problem

8. Inability to Sell the Property

9. Inability to Rent the Property

10. Mortgage Servicing Problems

11. Transfer of Ownership Delays

12. Reduced Income

13. Failed Business

14. Job Relocation

15. Death of the Borrower

16. Death of Spouse or Co-Borrower

17. Death in the Family

18. Incarceration

19. Divorce

20. Marital Separation

21. Military Duty

22. Medical Bills

23. Damage to Property (natural disaster or unnatural)

Notice that “My Realtor lied to me” and “My loan officer/broker lied to me” is not on this list. Keep this in mind when you write a hardship letter. Documenting the hardship is very important to the lender’s or servicer’s loss mitigation department and will be verified during the approval process. Without proper documentation, your file may be flagged as fraudulent. You definitely do not want this to happen for obvious reasons and it will slow down the process or terminate the process completely. Sample Hardship Letter

There are two important things to remember about loan modifications:

1. A loan modification should be requested only if no other reasonable options are available and/or the homeowner is experiencing a hardship.

2. Loan modifications are designed for homeowners who can afford their homes but not their loans.

Sample hardship letter: How to Determine if You are a Candidate for a Loan Modification

Lenders and servicers will, in general, look for one thing when you submit a modification request. They look for a documentable hardship of course, but at the end of the day if they decide to grant your request for a loan modification all they really want to know is if you can afford the new payment(s). This is the big secret behind getting a loan modification approved.

There is, however, an art to making loan modifications work. You must disqualify yourself from your old payments and at the same time qualify yourself on a new payment structure. It sounds complicated and it is at first but you will quickly learn important strategies for effectively processing loan modifications.

To understand what the lender or servicer considers qualified, you have to know how lenders calculate your income. The income you can use to qualify for a modification is different from traditional income calculations used to qualify for traditional loans. Moreover, the difference in the qualification guidelines is typically in your favor.

For a modification, you can qualify based on your documentable total household income. As such, you can count income from almost any source: Grandma’s SSI, income from child day care services, from a second job paid under the table, etc. so long as it can be proved. Proof must be in the form of bank statements, 1099’s or in some other documentable form as outlined in the submission paperwork you will provide the lender. In addition, if only one of two spouses was on the original loan, the other spouse’s income can count so long as it is documentable.Sample hardship letter

Once you calculate all documentable monthly income from all household sources you then have what you can present to the lender as the new qualifying income.

To calculate a qualifying monthly mortgage payment, use the benchmark fully amortizing 5.00% rate on whatever the new balance might be, counting arrearages if they are added back into the loan. WARNING: this is only for a general qualifying exercise only; do not expect this rate or payment! If the payment at 5.00% is just too high, then you may not be an appropriate candidate for a modification. However, you can still request help with other services such as a deed in lieu of foreclosure, a short sale or postponing as long as possible a notice of trustee’s sale in an effort to help you transition to more affordable housing.Sample hardship letter

Sample Hardship Letter: Effective communication is the single most important aspect of describing hardship issues. Many modification requests fail because the homeowners can not tell their story in a simple way. It is easy to forget there is a real human being analyzing the hardship letter within the lender’s or servicer’s loss mitigation department who is responsible for determining the existence of a real hardship. With that said you must keep your hardship letter simple and get to the point quickly.

Loss mitigation departments are overwhelmed with foreclosures, short sales, and modification requests. They do not want to read a ten page letter regarding the loan officer who put them in the loan, why they bought the house, the memories they have had there and why they want to keep their home. When writing the hardship letter, keep the letter simple and to the point. In addition, handwrite the hardship letter. The fact is that people personally relate to handwriting more than a typewritten letter and this includes the lender’s or servicer’s loss mitigators. What follows on the next pages are perfect examples of sample hardship letters, a financial worksheet, an income and expense worksheet, a sample loan modification request and a sample stacking order for you to use. Notice as well that on the loan modification request and on the sample stacking order for a loan modification you will need to include documentation of your home’s value. You can obtain reliable documentation of your home’s value from a local Realtor, Title Company or from an appraiser.Sample Hardship Letter

Sample Hardship Letter: Reasons to Conduct a Forensic Loan Audit
Obtaining a Forensic Loan Document Audit is essential in every Loan Modification, Short Sale, and Deed in Lieu resolution. The findings of an audit can significantly improve your chances for a positive resolution. The following are common reasons to conduct a forensic loan audit:
1. General Loan Documentation Errors
2. Reverse Engineering
3. Real Estate Settlement Procedures Act (RESPA) Violations
4. Truth in Lending Act (TILA) Violations
5. Home Owner Equity Protection Act (HOEPA) Violations
6. Good Faith Estimate Compliance
7. Misleading Disclosures
8. Overstated Home Values
9. Overstated Income in the Loan Application
10. Lender and/or Broker Misrepresentations
11. Usury Violations
12. Excessive ARM Adjustments
13. Packing
14. Excessive Points & Fees
15. Predatory Lending
16. Forgery
17. Loan Flipping

Sample Hardship Letter: To perform the most comprehensive forensic loan audit you should compile all of the loan documents you maintain and get all of the loan documents your lender maintains. A Qualified Written Request (QWR) is a written demand to your servicing company. After receiving a QWR, the servicing company has twenty days to respond to the request and forward a copy of all loan documentation on file. The servicing companies also have to suspend all reporting activity to the major credit bureaus and then resolve the issue within sixty days. Federal RESPA laws require the servicing companies to comply and respond within this specified time frame. A QWR will be generated by you and submitted to the servicer for every file prior to the completion of the forensic loan document audit.