Writing A Hardship Letter Auto Loan Modification

It is important that you write a request for auto loan modification properly. It has to be short and to the point, containing only the right information. If you want your loan to be modified as a result of hardship, you must make this very clear.

These types of letters are very formal, and they are a way of asking for help from creditors. You hope that, by understanding your situation, they will be willing to make a short term change to your terms and conditions that are easier for you to comply with.

Basic Rules for Writing a Hardship Letter Auto Loan Modification

You must clearly explain your hardship and provide sufficient evidence for it as well. Remember that the creditor is interested in facts. Hence, avoid becoming emotional about your situation. Indications of hardship could be things like:

  1. An unexpected reduction in income
  2. A death in the family
  3. Medical bills and/or disability/illness
  4. Losing your job

You should also state what efforts you have made to keep up with your payments. For instance, you may have canceled memberships to the gym and Netflix, and you may have taken on a part time job.

You must make sure that the letter is addressed to the right person. Hence, contact your lender first and ask to whom it should be written to. It is also possible that the auto loan company has a standard form that you must fill in to accompany a hardship letter.

What to Do

Some tips for writing a hardship letter of this kind:

  1. Keep the letter on one page.
  2. State all facts succinctly, objectively, and clearly.
  3. State that you want to come to a resolution.
  4. Attach all documented evidence to prove your current situation.
  5. Thank your creditor for their time and consideration.

What Not to Do

Some of the things you should not do in auto loan modification hardship letter:

  1. Overdramatizing or exaggerating the hardship situation you are in.
  2. Making false claims.
  3. Promising things that you will not be able to deliver on.
  4. Placing the blame on the creditor rather than on yourself or the situation being beyond your control.
  5. Being threatening, such as stating you will file for bankruptcy if you don’t get help (although you can mention that you may be forced into bankruptcy).

The most important thing is that you take responsibility for your own actions. Hardship is mostly caused by external events beyond your control. However, this doesn’t mean that you should play the blame game. Rather, you should demonstrate that you have been proactive in changing the situation and that there is simply nothing else that you can do. State as well that you will be willing to make alternative payments, if that is possible. Finally, you must make it very clear what type of modification you are looking for. This could be a freezing of payment, no longer having to pay interest, a break in payments, lengthening your agreement, and so on.

Hardship Letter Auto Loan Modification Example

{Your Name}
{Your Address}
{Your Phone Number}


To Whom It May Concern:

I am writing to try to request a modification to my car loan, since I am unable to meet my current payments. Specifically, I would like to {lower the interest rate/remove delinquency fees/forgive delinquent payments}.

My auto loan has proven unmanageable and as of {date} it is especially problematic because {the car has lost value/the loan value is upside down/I’ve experienced sudden, unexpected financial difficulty}.

As of {date}, I {owed more for the loan than the car was worth/I was involved in an accident that wasn’t my fault/I lost my job, etc.}. I would like to avoid repossession, but I can think of no way out of this situation without a loan modification.

I am hoping that we can work out some sort of solution as quickly as possible. Please contact me immediately so that we can begin this process.


{Sender Name}

Writing A Hardship Letter To Credit Card Company

Almost every adult in this country has credit card debt. Some only have a few hundred dollars of debt, while others have thousands of dollars of debt. Either way, there may come a time when it becomes extremely difficult to pay even the minimum amount that is due. The economy continues to be unstable and this means that it is possible that you may need some sort of debt relief, such as a lower monthly payment for a short period of time. This is something that credit card companies are very familiar with.

Why Credit Companies May Agree to Help

In most cases, credit card companies usually agree to work with people in difficulty because the alternative for the debtor is to request bankruptcy, which means the credit card company gets nothing. Hence, it is better to write a hardship letter, in which you tell the creditor about your financial situation. This will also stop them from harassing you, and it will give you a chance to protect your credit rating. It is not, however, a way to get out of your debt.

If you can prove hardship, the credit card company will usually help, for instance, by lowering interest rates and suspending any late payment fees. They will, however, also want you to stop using your credit card. Additionally, they want to see you make every effort you can to repay your debt. Hence, do make sure that you tell them how much you are willing to pay each month, and when you expect your hardship to be over.

Steps in Writing a Hardship Letter to Credit Card Company

  1. Make sure that you write your letter formally. Place the name of the company at the top of the page and date it as well. Place a reason line below this, and make sure your credit card account number is included as well.
  2. Write your first paragraph, in which you explain that you are asking for help and you tell them why you are in hardship. For instance, you may have been made redundant, or you may have had an unexpected huge medical bill. Be honest and open, but keep it short and to the point.
  3. Explain how you aim to rectify the situation. Tell them how much you are able to pay instead of your regular bills. Do not put more in that figure than you can afford. If you can only afford a dollar a week, then tell them and don’t say you can afford $10 a month even if you can’t. At the same time, don’t offer them less than you can afford either. They are likely to want to see a financial statement from you, so they will know if you can pay more than you are offering.
  4. Tell them when you expect your hardship to be over and what you aim to do about your outstanding debt at that point.
  5. Thank them for their consideration and ask them to contact you as soon as possible with their decision.

While there is no guarantee that your credit card company will agree to your request, most will accept it because it means that they will be able get what is owed eventually.

For more sample hardship letters, click here.

Hardship Letter To Credit Card Company Example

{Your Name}
{Your Address}
{Your Phone Number}


RE: request for {consolidation/restructure} of loan for {VISA, Mastercard, etc.}, account {account number}

To Whom It May Concern:

I am writing to request the {consolidation/restructure} of my credit card repayment, due to financial hardship.

The current balance on my credit card is {amount in dollars}, and I have been paying {amount in dollars} every month for {length of time}. This had been an adequate system, until recently, when I fell on hard times.

Due to {death in the family, divorce, medical problems, etc.}, which began {date}, I have been unable to keep up with the payments. I have attached {list of financial documents attached}, which should illustrate exactly why I am in need of your help. I am accruing more and more in the way of late fees and finance charges, which means my balance just continues to increase, and there is nothing I can do about it.

I am requesting {consolidation or that the company accept a certain amount that is less than the total due}. I am extending the same offer to other creditors, so that I can avoid filing for bankruptcy.

Please contact me as soon as possible so that we can get the ball rolling on this situation.


{Sender Name}

Writing a Hardship Letter to IRS

The Internal Revenue Service (IRS) may, at times, look at a taxpayer’s debt ratio. If they deem it necessary, they may delay account collection for that particular person. This is a “currently not collectible” type of action, and one that you can request by writing a hardship letter to them. The debt will never be forgiven or erased, but they will agree that you are not currently capable of paying what is owed. To prove this, you will have to write a hardship letter and provide evidence of your inability to make payments. However, remember that interest and fees will continue to be charged on what you owe.

Checklist for Writing a Hardship Letter to the IRS

Below is a checklist of the things that you should and should not do in terms of writing a hardship letter:

  1. Fully highlight your personal circumstances. The IRS wants to have a full understanding of why you are in hardship. Perhaps you are a self-employed individual and your business has failed, which in turn means you cannot pay your taxes. Perhaps you have a partner who has experienced a serious medical problem, such as an accident, which substantially reduced your earnings. This type of information should all be given to the IRS with as much detail as possible. Do not exaggerate, however. You should simply provide the facts.
  2. Make sure you include all relevant documentation. These include three months’ wage statements, three months’ bill statements, doctors’ letters, three months’ bank statements, a landlord or mortgage company letter, your last tax return, and any other financial documentation.
  3. Indicate identifying information. These include your IRS location, the agent’s name, the year for which you are applying for hardship, your contact information, your Social Security number, your legal name, and so on.
  4. Always include Form 433 and any other form that applies to the situation you are in. Three forms are included as part of Form 433: (a) Form F, which is for individual tax payers; (b) Form A, which is for self-employed individuals; and (c) Form B, which is for businesses.
  5. Always be polite. The IRS is a massive organization, but cases are handled by individual collectors. They do not like rude language or aggressive demands. Remember that you are asking them for a favor.
  6. Never be vague. Do not say, for instance, that you have “some unexpected financial difficulties that will likely end soon”. Rather, highlight what the financial difficulties are, how they have impacted you, and exactly when you expect them to be over.
  7. Try not to get emotional. What matters to the IRS are the numbers, dates, and other facts. They don’t want to know how you feel.

If you do find that you are in financial difficulties that are making it impossible for you to pay your tax due, then you should consider seeking some professional advice. Taxes are very complex, and the IRS is quite an intimidating agency. Hence, if you aren’t 100% sure about what you are doing, ask a professional who is experienced in these matters to help you.

Hardship Letter to IRS Example

{Your Name}
{Your Address}
{Address Continued}
{Your Phone Number}

{Internal Revenue Service}
ATTN: {appropriate department}
{Address Continued}


To Whom It May Concern:

I am writing to attempt to stop a bank levy that the IRS is ready to impose on my account(s).

I have experienced a great deal of financial hardship lately, due to {details of the hardship that have made it impossible for you to pay the taxes due to the IRS}.

If the IRS continues with this plan to freeze my account(s), I will not be able to meet the basic standards of living. I have attached my most recent pay stubs {along with other relevant information} to illustrate the fact that I simply do not make enough money to be able to afford to have my account(s) frozen.

I am requesting {a payment plan, a settlement negotiation} in lieu of the levy. Please contact me as soon as possible so that we can work on getting this resolved.


{Sender Name}

Writing A Hardship Letter Wage Garnishment

There are numerous avenues available to creditors to collect unpaid debt. One of those options if for them to apply for wage garnishment. This means that a percentage of your earnings is taken straight out of your salary and paid to the creditor. This percentage can be quite high, and it can cause significant hardship as well. If this is the case with you, then you may want to consider writing a hardship letter.

Basic Tips for Writing a Hardship Letter Wage Garnishment

This type of letter must be formal, which means it should be typed out, addressed to the right person, in the correct format, and free from spelling and grammatical errors. It should also, in the subject line, include an account number of the debt that is owed, if you have it.

State Your Request

Start your letter by explaining what you are requesting. This would be a cessation of the actions that are currently being taken in order to recover your debt. State that you are in the process of developing a payment plan, which you should attach to the letter. Explin that, while you understand that wage garnishment is an option for the creditor, it would be extremely detrimental not just to you, but also to members of your family.

Provide Details of Your Income and Expenditures

Before you write the letter, you should have prepared a statement of your income and all your expenditures. It should state how much of your income goes to necessary bills, and how much you have left. This statement should be included in your letter. You should also make it clear that you financially support other members of your family, and that the vast majority of your income goes to certain bills, leaving you with a certain amount each month for nonessential expenses. Thus, if a wage garnishment is applied, you would be left with virtually nothing towards the nonessential expenses, and that this could lead to you being declared bankrupt. Do not be afraid to state that bankruptcy would mean that your creditor will not receive any money at all. However, make sure that you don’t state this in a threatening way. After all, it is not their fault that you are in financial difficulties, and you are asking them to do you a favor.

Indicate Your Suggested Debt Repayment Plan

State in your letter that you are aware of the fact that you are not able to keep up with debt payments on your current income but you are doing something to increase it. Make a suggestion for a debt repayment plan and when you expect this to start. Indicate that you are looking forward to hearing back from them as soon as possible.

Make sure you include copies of every relevant document with your letter. Do also keep copies for yourself, and send the letter via registered mail. If you have not heard back from them within one week of your letter being received, make sure to follow up. It is your responsibility to take action if you want to avoid wage garnishment, after all.

Hardship Letter Wage Garnishment Example

{Your Name}
{Your Address}
{Your Phone #}


To Whom It May Concern:

I am writing this hardship letter to request a cessation to the actions being pursued by your company in regards to my debt. I am working to create a payment plan that we could agree on, but wage garnishment is extremely detrimental to my current family and financial situation.

I am including a worksheet of my income and how it is distributed to necessary bills. As you can see, I am the sole supporter of a {number} person family. Most of my paycheck goes toward {mortgage, rent, hospital bills, be specific}. This leaves me with {amount} leftover every month for nonessential expenses. If my wages are garnished then this will only further my difficulties and may lead to bankruptcy. If that were the case, I cannot imagine that I will ever be able to repay the charges.

I understand that the current disposable income amount that I have is not enough to keep up with my debt. Therefore I have also included a worksheet detailing a possible debt payment plan that might work for both of us. Please contact me as soon as possible so that we can work something out.

Thank you for your time and consideration.

{Sender Name}