Writing A Hardship Letter Adjustable Rate Mortgage Loan Modification

/0 Comments/in /by

When you write an adjustable rate mortgage loan modification hardship letter, you are formally requesting that the terms and conditions of your loan be changed. The letter is an opportunity for you to highlight your financial difficulty and to attempt to get better terms and thereby avoid a foreclosure. Remember, however, that lenders are not interested in life stories. All they want to know are the facts that surround your current situation.

Key Reasons for Writing the Hardship Letter

There are two key reasons why you may want to send this letter: medical issues and job loss. In addition, some lenders will accept death of a spouse, divorce, military duty, a newborn child, and relocation. Sometimes, they will even accept a failing or failed business. However, they are unlikely to assist if there isn’t a benefit in it for them. Lenders don’t generally want to repossess properties, which means they will want to avoid foreclosing the property as well. Hence, if you can explain that you don’t want to get out of paying your debt, but that you simply need some help, you have the best chance of being accepted.

Basic Rules in Writing the Hardship Letter

Make sure that your letter comes across as positive. They want to see that you are a responsible borrower who wants to do the right thing. Hence, you should be matter of fact about your situation and about what you have done and are doing to stay on top of your bills. You have to be able to prove everything that you state as well, so do make sure to show some documents.

The letter is perhaps the most important thing in this entire process. Hence, you need to make sure it includes all pertinent details:

  1. Why you are behind in your payments
  2. When you first fell behind
  3. When and how you expect your situation to improve
  4. What kind of modification are you asking for
  5. How much you are able to pay each month, if anything
  6. Whether you are seeking treatment if the difficulty is due to an addiction

The letter must be signed by you, even if you have asked a consultant to write it for you. You also have to make sure that it is a genuine letter, and not simply a template with some details changed. You should not include a lengthy narration of your situation, nor should you exaggerate your situation. Be to the point and honest instead.

Finally, remember that this is a formal letter. Hence, address it to the right person in the right format. The subject line should include your reason for writing, as well as your account number. You should also make sure that there are no grammatical or spelling errors in the letter, so proofread it or ask someone to do that for you. You should also try to have all the information on a single page. Longer letters are more likely to be dismissed, simply because hundreds of them are received every week and lenders have a limited time in which to read through all of them.

Hardship Letter Adjustable Rate Mortgage Loan Modification

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

{Date}

To Whom It May Concern:

I am writing this hardship letter to request a loan modification. My financial situation cannot currently accommodate the adjustable mortgage rate that is being asked of me.

For the last {number} years, my mortgage has been billed to me at a fixed rate of {amount} per {time}. As of {date}, however, the amount due jumped to {amount} per {time}.I understand that I entered into an adjustable rate contract, and originally I had a financial plan that was flexible enough to meet the projected expense. Unfortunately, new circumstances have drastically depleted my funds, and I find myself facing foreclosure if I cannot meet the new payments.

My finances have changed due to unexpected {medical bills, job loss, etc. Be specific.} While I could afford the fixed rate, this new expense is too much for my limited account. I have attached last year’s federal income tax return and my credit card bills from the last two months. Also included is a worksheet detailing the dispersal of income among essential payments.

I would like to request a return to my former fixed rate, which is still a payment I can afford. If that does not work, perhaps we could come to terms on a deferral plan or a principal loan reduction.

I hope to avoid foreclosure at all costs. Please contact me as soon as possible so that we can work out a payment plan.

Sincerely,

{Sender Name}

Writing A Hardship Letter After Foreclosure

/0 Comments/in /by

Once you start to fall behind on your mortgage payments, there is the possibility that you will end up in foreclosure. Indeed, there could be a time when you find no other way but to allow your property to be foreclosed because there was no opportunity for your financial situation to improve at that point in time. However, this does not mean that you will always remain in that situation. There may come a time in which things have picked up again, and you are ready to apply for a new mortgage. Unfortunately, many lenders will likely decline your application upon knowing your foreclosure. However, if you can explain that this was due to real financial hardship, you may find a lender who may approve your application.

Tips in Writing a Hardship Letter After Foreclosure

If you were in genuine hardship, a lender may consider this when deciding whether or not to provide you with a new mortgage. However, you will have to submit significant evidence to prove your situation. Additionally, you must write a proper hardship letter.

A hardship letter is a personal document. You must use it to provide an overview of the situation that you were in, and how this eventually led to your foreclosure. The letter, in this instance, must also prove that your hardship has now ended.

The hardship letter after foreclosure has to be a formal letter. This means that you have to give factual reasons, such as the death of a spouse, involuntary reduction in hours and income, loss of job, relocation, incarceration, divorce, or medical bills, and other past problems. Essentially, you must provide factual details about the personal circumstances that have affected you. At the same time, these should be clear, concise, short, and to the point.

If at all possible, you should keep the letter contained to a single page. It should provide all the important details:

  1. Why you were in difficulty
  2. When the difficulty started
  3. Why you are now no longer in difficulty

It is quite difficult to prove to a lender that your credit history reflects a glitch in your circumstances and is not, therefore, a full picture of who you are today. Indeed, that is why credit files exist. However, this does not mean that it will be impossible for you to get back on the property ladder after some time. Situations resulting to hardship are mostly beyond your control, and lenders do realize that.

Remember that the hardship letter after foreclosure is a formal document. It will be kept on your permanent file as well. Hence, you should write it in a business style, addressed properly, and with your account details in the subject line. Do also make sure that you include photocopies (not originals) of every piece of evidence you supply. The letter should be free from spelling or grammatical errors and it is recommended that a third party proofread it for you. Lastly, send your letter via registered post and do follow up if you have not received a reply within one week.

Hardship Letter After Foreclosure Example

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

{Date}

To Whom It May Concern:

I am writing this hardship letter to request that the waiting period between conventional mortgage loans be reduced in my case. The foreclosure on my previous house was due to a number of extenuating circumstances beyond my control, and I foresee no such difficulty in my new situation.

I was forced to foreclose on my former residence because of {job loss, illness, family death, be specific}. Because this sudden change caused a devastating {monetary amount} loss to my income, I could no longer pay my mortgage. Foreclosure was the only option for my situation. I have attached {documents} as a testament to my honesty. My financial detriment had nothing to do with overspending or irresponsible purchases.

Since my foreclosure, however, I have regained my credit through {getting a new job, paying off bills, etc. Be specific}. I have attached my last two credit card bills, a copy of my credit report, and last year’s federal income tax return to prove my present situation. I am financially stable and able to easily cover mortgage payments. I would like to take advantage of the current housing climate, but I cannot get a loan for another {number} years.

Please contact me at the aforementioned number at your earliest convenience. I am asking that the loan waiting period be reduced from the traditional 4 to 7 years to {number} years. I look forward to speaking with you regarding this matter.

Sincerely,

{Sender Name}

Writing A Hardship Letter Keep House

/0 Comments/in , /by

When you buy a home, you do so with the intention of staying there for a long time. Nobody wants to start a mortgage expecting it to go into foreclosure at some point. However, there are situations beyond your control that may push you towards that. If that has happened to you, and you want to keep your house, one option is to write a hardship letter to your mortgage provider.

Basic Tips in Writing a Hardship Letter to Keep House

This letter is a formal letter that must be written to the right person, in the right department. It is also highly likely that your mortgage lender has a standard form that you must complete. Hence, it is advisable to contact your lender first to ask for this form, and to find out to whom you should write to.

As a formal letter, it should be properly formatted, dated, and free from spelling and grammar mistakes. It should also hold your account number in the subject line, as well as other identifying information so the lender can confirm who you are.

Content of the Hardship Letter

Your letter should make it clear that you want to keep your house. A lot of people who experience hardship are in the process of selling their property and therefore simply want an extension of payments. Others want to request approval of a short sale. It is vital, therefore, that you start your letter by stating that you are experiencing hardship, but that you want to remain in your home.

State how important your property is to you and your family. Give a brief description of your family makeup and how you would be affected if you and your family were forced to leave the property. State that your home is at the heart of your family, educational, social, professional, and spiritual lives. Write that you would like to come up with a loan modification or forbearance plan that will enable you to keep your property.

Explain what has forced you to become delinquent in your payments and make sure that you include documented evidence for that. Examples may include losing your job, the death of a relative, incarceration of the breadwinner, a sudden illness or disability, and other such situations. All of these are situations that are beyond your control, but have caused you significant financial hardship.

Next, you must propose a solution that you believe to be mutually beneficial for you and the lender. Loan modifications of this kind tend to be temporary only. For instance, state how long you will be able to making reduced payments, and in what amount. Also explain how you intend to repay the amount that you will have missed as a result of this modification. Do not make any promises that you cannot keep, however. It is better to only offer $5 a month and pay that, than to offer $500 and not be able to make the payment. After all, your lender is only likely to give you such a chance once.

Hardship Letter Keep House Example

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

{Date}

To Whom It May Concern:

I am writing to you today concerning my mortgage foreclosure. This home is extremely important to me and my family, as it is in the center of our professional, social, educational, and devotional lives. I would like to work out a forbearance plan or loan modification that would allow me to keep the house.

My inability to pay the mortgage on my house has arisen from {specific and detailed situation. Family problems, medical emergencies, death, loss of income/job, etc. Attach documents as necessary to prove financial hardship}.

I would like to propose a temporary loan modification plan. With my savings of {amount} I can make a reduced payment of {amount} from now until {date}, when I shall hopefully {resolution of aforementioned problems}. At that time I would resume paying the previous amount of {amount}. I hope that I have made it clear how necessary my home is to both me and my {members of family}. It is critical to our daily lives in {specific ways} and we cannot afford to lose it at this time.

Thank you for your time and consideration.

Sincerely,

{Sender Name}

Writing A Hardship Letter For Deed In Lieu Of Foreclosure

/0 Comments/in /by

If you are facing foreclosure and you want to avoid it through a deed in lieu of foreclosure, then you will need to write a hardship letter. A deed in lieu is a form of loss mitigation, which usually means completing a standard hardship affidavit, although separate letters may also be required. As part of this process, you will usually also have to provide information such as bank statements, financial statements, tax returns, and pay stubs. Put together, these can demonstrate your hardship.

Defining Hardship

You are considered as experiencing hardship if things happen over which you have no control, and that lead to you being unable to make your mortgage payments. There are a number of situations in which a deed in lieu of foreclosure may be considered to resolve hardship, such as:

  1. An involuntary decline in income or job loss
  2. Illness of a family member of the homeowner
  3. Separation or divorce
  4. Medical expenses
  5. Military service
  6. A reset of the adjustable interest rate
  7. A natural disaster

What to Include in a Hardship Letter for Deed in Lieu of Foreclosure

A lot of people write their hardship letter without really thinking about what to include in it. Worse still, some people simply copy an online template word for word. Remember that there are hundreds of people writing these letters on a daily basis, so you need to write something that stands out. Templates should only be used as a guide. Rather, you need to focus on providing information that is pertinent and personal to you and your situation. At the same time, you have to make sure that you don’t turn the letter into a sob story. The lender wants to hear the facts, and you should try to present those facts on a single page.

A hardship letter is designed to explain why you are in a certain situation and that you would be able to avoid foreclosure with their help. You must make your wishes clear, such as receiving the deed in lieu of foreclosure, before you move into an explanation of your hardship. This ensures that a mortgage expert reads the rest with the understanding of where you are going.

Make sure, as well, that your letter makes it clear that you are not trying to shirk from your financial obligations. Rather, you should state that you want to make certain payments until you have been able to rectify your situation. Be realistic in this and do not make promises that you are not sure you will be able to keep. Promising just $10 a month is better than promising $100 and then not making the payment.

Nobody wants to be in a situation of hardship. Your lender understands that and taking foreclosure action is something that they will want to avoid as much as you do. Hence, if you are honest, present them with facts, and show you are willing to work at the situation, you might be able to get some leniency and receive a deed in lieu of foreclosure arrangement.

Hardship Letter For Deed In Lieu Of Foreclosure Example

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

{Mortgage Company Name}
ATTN: {appropriate department}
{Address}
{Address Continued}

{Date}

RE: deed in lieu of foreclosure on {address}

To Whom It May Concern:

I am writing to begin the process of offering the deed to my home, in lieu of foreclosure.

I have missed {number} payments on my mortgage with your company, due to significant financial hardship in my life. The hardship was caused by {detail the reasons you’re struggling to make the payments; be specific and emotional}.

The home has been on the market for {length of time}, and in that time the asking price has been reduced from {amount in dollars} to {amount in dollars}. I do not have a buyer willing to purchase the home, despite my best efforts to find one, so a short sale is not an option.

I believe I will be unsuccessful in my attempts to sell this home, nor will I be able to make the mortgage payments. Rather than deal with the foreclosure process, I would like to give you the deed to my home, in exchange for forgiveness on the loan. I do not have a second mortgage, and there are no other liens on the property.

I have attached all relevant documents for the house and for my current economic situation.

Please contact me as soon as possible so that we may begin this process.

Sincerely,

{Sender Name}

Writing A Hardship Letter For Short Sale

/0 Comments/in /by

If you have to short sell your property as a way to avoid foreclosure, your realtor may want you to write a hardship letter for short sale. Short sales are real estate transactions in which the amount paid for selling the property is less than the amount still owed on it and this is provided as payment to the lender. In order to have an acceptable short sale, the lender must be wiling to receive less money than the outstanding debt. Since there are costs for proceeding with the foreclosure, the lender may be willing to accept a lower amount.

Basics of Writing a Hardship Letter for Short Sale

The letter is a personal one that you write to your lender. It should explain why you have missed payments and what financial difficulties you currently undergoing. This is a normal part of the overall process. You will usually also have to include bank statements, financial statements, salary stubs, and tax returns. Additionally, you will have to evidence the hardship, which means you have no control over the situation you are in.

The letter itself should be as short as possible, without missing out any important information. There are templates that you can follow, but they should be seen as a guideline only, not something you can simply copy and paste.

Your letter should explain your situation and provide evidence of your hardship. It should also include details on why it is in the interest of the lender to accept a short sale. That it is in your best interest is clear, so you do not need to focus on that. Rather, you have to sell the short sale to the lender.

Explaining Your Hardship

Some hardships are quite commonly accepted. They include military service, natural disasters, interest rate resets, medical expenses, separation or divorce, loss of job, involuntary reduction of hours, or job transfer. Other reasons may also be accepted.

Make sure to include:

  • Your contact details, including account number
  • Photocopies evidencing the changes in your financial situation
  • Photocopies of all your bills
  • Proof of efforts you have made to reduce your expenses and/or increase your income.

Remember that you are asking your lender for a favor. Thus, there is no guarantee that your request will be granted. Hence, do not indicate or imply that the lender can be blamed for your situation. You should also not make any promises that you cannot keep. Additionally, you should not talk about the possibility of getting money from non-traditional sources, such as borrowing from your parents. Because that isn’t regulated, the lender will not be able to count on it. Finally, you should not use the letter to write a lengthy emotional account of how your hardship situation has affected you. That is common sense and it does not provide any new information on your ability or inability to meet your financial obligations.

A final thing to remember is that this is a formal letter. That means that you have to write it properly, without any spelling or grammar mistakes. You should also proofread it, or ask someone to do it for you. Send it via registered post and keep photocopies of the letter and attached documentation as well.

Hardship Letter For Short Sale Example

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

{Date}

RE: short sale request for my home at {address}

To Whom It May Concern:

My name is {Name}, and I currently reside at {address}, a house that I bought on {date of purchase}. At the time, {mortgage company} provided me with a {30-year, 15-year, etc.} mortgage of {amount in dollars}, with a {fixed/variable} interest rate.

When I purchased the home, I was perfectly capable of making the mortgage payments on time and in full. Since {date}, however, I have been struggling to make the payments because of {details of why you have fallen behind on payments; be specific}.

Currently, my monthly income is {amount in dollars}, which must go to {medical payments, childcare costs, etc.}, leaving an amount that will not satisfy my mortgage payment.

I have found a buyer who will purchase my home for {amount in dollars}, which is the best offer I have found since putting the home on the market in {month}. I am hoping you will accept this offer so that we can both avoid the hassle and cost of a foreclosure.

I would also appreciate it if we could work out a plan that doesn’t require you to make a negative report on my credit.

I have enclosed the relevant financial paperwork that will help to illustrate my current situation, including {explanation of the paperwork you’re including}.

I am truly sorry that I have ended up in this situation, and I hope that my plan for this short sale will make it so that we can all move on as quickly and smoothly as possible.

Sincerely,

{Sender Name}

Writing A Hardship Letter For Rental Property

/0 Comments/in /by

If you own an income property and it is still under a mortgage, there are certain situations in which you may find yourself incapable of paying the amortization. If this situation is beyond your control, which means you are experiencing true hardship, it may be possible for you to avoid foreclosure on the property by appealing to the goodwill of your lender. To do this, you have to write a properly formulated letter.

Tips in Writing a Hardship Letter for Rental Property

A hardship letter is a formal letter and must be treated as such. Address it properly, make sure it is proofread, and send it via registered mail. Keep copies for yourself so that you have a paper trail of your correspondence. Show that you are willing to come to an arrangement and there is a chance that your lender will feel the same way.

Start your letter by explaining that you are aware that you have not been making the necessary payments on your property, and that you hope to remedy that by being able to come to a mutually satisfactory arrangement. State that you wish to avoid foreclosure, but that you are currently experiencing financial hardship. It is very important that you are specific about the nature of your hardship, and that you include documented evidence for it. Examples of acceptable hardship include:

  1. Loss of employment or involuntary reduction in hours and income
  2. Death in the family
  3. Medical bills
  4. Sudden illness or disability
  5. Incarceration
  6. Separation or divorce

What to Include in the Hardship Letter for Rental Property

Explain that the money that you currently have as an income has to cover a number of bills. Include copies of all your bills, such as for medication, home mortgage, car payments, and food. Make it clear that you have worked hard at reducing your expenses by giving up on life’s luxuries, and that you have tried to increase your income, for instance, by taking on a part time job. However, despite these efforts, you still find yourself in a situation that makes it impossible to keep up with your payments for the rental property.

State that the property in question is one that provides you with rental income. Indicate when you rented out the property and for what monthly amount. If you don’t have tenants in the property or if there are a lot of vacancies, remember to mention that. If tenants are present and they pay their rent on time, explain why this still is not sufficient for you to keep up with the payments.

Suggest a Mutually Acceptable Solution

You must then provide a solution that you believe to be acceptable for you and the lender for the payment of arrears. State whether it is your desire to keep the property, or whether you would be happy with selling it, perhaps through a short sale. If you want to keep your property, make an offer of reduced payments, showing an amount and specifying for how long you would be doing that. Do not promise an amount that you really cannot afford in your current situation. Also, offer a repayment plan for the shortfall when you finally get back on track, again only offering to pay what you expect your future finances will allow.

Hardship Letter For Rental Property Example

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

{Date}

To Whom It May Concern:

I am writing this letter to explain the reasons why I have been unable to pay my mortgage payments on the property at {address}, and to inquire as to what I can do to avoid foreclosure on my property.

My income has become significantly reduced recently, due to {sickness, death in the family, job loss, etc. BE SPECIFIC}. The money I have remaining every month must go to {food, car payment, mortgage on home, medication, etc.}. I have done everything in my power to keep up with the payments, but it unfortunately has become impossible {or will become impossible as of a certain date}.

I have been using this property as a rental income property for {length of time}, and I {do/do not} currently have tenant(s). {If you have tenants, indicate the amount they pay in rent each month, and why this is still not sufficient to keep you up to date on the mortgage} .

I believe I can resolve my debt by {your solution to “working out” the debt, or a request that they provide the solution}.

Please understand that I know I signed a contract and that I am responsible for these payments, but there is also only so much I can do with the little money I currently have.

It is my intention to keep this property if I can, so I hope we can work out a solution as quickly as possible.

Thank you,

{Sender Name}

Writing A Hardship Letter For Loan Modification

/0 Comments/in /by

Writing a loan modification hardship letter means that you are formally requesting your lender for some changes to the terms and conditions of your loan. This letter is an opportunity for you to highlight your financial difficulties and to prevent a foreclosure for the case of a mortgage. This letter must be factual, rather than a sob story, however, so do make sure that you write it properly.

Why a Loan Modification May Be Needed

There are two key reasons as to why you may apply for a loan modification:

  1. You have lost your job.
  2. Your are facing serious medical issues.

Other reasons, such as divorce, separation, death in the family, incarceration, and military duty, may also be accepted. However, whatever the reason may be, you have to make sure that you can provide sufficient evidence for it. You also have show how it is affecting you and your family financially.

Questions to Serve as Guide for the Content of the Hardship Letter

A lender will have a number of questions and you must attempt to answer these immediately. These are:

  1. Why are you behind in your payments?
  2. When did you start to fall behind?
  3. Will your situation improve and, if so, when and how?
  4. What modifications are you asking for?
  5. How much you can pay in the immediate and how long for.
  6. Whether you are receiving treatment if the hardship is due to an addiction.

Tips in Writing a Hardship Letter for Loan Modification

You must make sure that you offer something that benefits your lender as well. Being able to collect something and keeping the loan active would be better than you getting into bankruptcy or foreclosure. If you explain that you have every intention of repaying your debt but that you simply need some respite at this point, your creditor may be willing to consider it.

Your letter should be positive in tone. You must show yourself to be a trustworthy person who always pay as long as your finances allow it. Be matter of fact about this and provide evidence for your claims. Include payslips, copies of bills, bank statements, proof of attempts to reduce your expenses and increase your income, and so on.

It is also possible that you have sought out the assistance of experts like a lawyer or financial consultant. If so, they may be writing the letter for you. However, it is vital that you sign it and not the consultant or legal professional. You should also avoid simply copying a template.

When you write your loan modification hardship letter, keep it short and to the point. State the facts of your situation in an honest way. Never place any blame on the lender or other third party for your situation either. These letters are formal letters and they will be kept on your record permanently. Hence, make sure that it is written appropriately, addressed to the correct person in the right department, and free from spelling and grammar errors. It is also likely that your lender will have a standard form to fill in for loan modification requests, so do find out about that before sending your letter. Make sure you keep copies for your own records, and send the letter via registered post.

Hardship Letter For Loan Modification Example

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

{Mortgage Company Name}
ATTN: {appropriate department}
{Address}
{Address Continued}

{Date}

RE: loan modification for {Name}

To Whom It May Concern:

I am writing this letter in support for my loan modification plan for the {mortgage, loan, etc.} on the {home, car, etc.} located at {address}. My intention is to stay in my home, and my hope is that the loan modification will allow me to get my loan in order and back on the right path.

I have been unable to pay my mortgage payments on time due to {explanation of the reasons you are experiencing hardship; be specific}.

I have attached the appropriate financial documents, including {list of documents}, which should illustrate to you how serious my situation has become.

I hope that we can work together, and quickly, to modify this loan so that I may begin to make the payments again as soon as possible.

Sincerely,

{Sender Name}

Writing A Hardship Letter To Stop Foreclosure

/0 Comments/in /by

The U.S. Government believes that if homeowners are facing the threat of foreclosure, there are a number of things that they should do. The first is to make sure that they stay in direct communication with their lenders, rather than ignoring them in the hopes of the problem simply vanishing at some point. If they receive any requests, or if they receive any court documents, these must be responded to as soon as possible. However, the U.S. Government also believes that people should be able to stay in their homes. So much so, in fact, that the government has rendered those who leave their property incapable of receiving any help. This is quite significant, both for lenders and borrowers.

The problem with forcing people to remain in their homes is that they often stop treating the property properly. Lenders who have had to foreclose on homes have often found them to be in a state of significant disrepair and squalor. This is a terrible situation in and of itself, but it is one that may be able to work in your favor to a degree. Indeed, if you write a hardship letter to stop foreclosure, you can cite the fact that it means your lender will not be left with a neglected property. However, you must be very careful with this, as threatening or blackmailing your lender in any way will not go in your favor.

Before Writing the Hardship Letter to Stop Foreclosure

Before you write a letter of hardship, consider whether there is other help out there first. For instance, you may be approved for a Housing and Urban Development (HUD) program. These are counseling agencies that can help you find solutions to your problems and help you stay in your home.

Content of the Hardship Letter to Stop Foreclosure

If you do find yourself in significant hardship, then you may want to consider writing this type of letter. You should make it clear which property you are discussing and when you first started to own it. Explain that, as of a certain date, you started to fall behind on payments and that this is because of a certain situation. Detail the causes of your hardship, such as loss of a job, medical bills, or death in the family, and make sure they are dated as well. Indicate that, as a result of this hardship, you have not been able to keep up with your mortgage payments, stating how much they are.

Explain that you hope to be able to avoid foreclosure. State that your home is not currently on the market and that you would like to remain in it. If you do want to sell your property, explain that it has been listed since a certain date and for what price. If you want your lender to approve a short sale, this is important information.

Next, you should offer a solution. This could be a temporary loan modification, for instance. Be to the point and factual, so that your lender is not left with any unanswered questions.

Hardship Letter To Stop Foreclosure Example

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

{Date}

RE: stopping foreclosure on {address of home}

To Whom It May Concern:

I am writing in the hopes that this letter will help to stop the foreclosure proceedings on my home at {address}.

I have owned this home since {date}, and have recently begun to fall behind on payments due to financial hardship. This hardship was caused by {details of the hardship; could be medical bills, death, job loss, etc.} and has left me unable to keep up with the mortgage payments of {amount in dollars} per month.

I would like to avoid foreclosure. I {am/am not} committed to staying in my home. My home {is/is not} on the market. {If it is on the market, indicate the current asking price, and if you are requesting approval of a short sale}.

{If you are trying to consolidate or restructure your loan, indicate that here, along with any plan you have in mind for doing so} .

I have attached all my relevant financial documents, including {list of what you’re attaching}. I hope we can work together to avoid the complications and price of foreclosure.

Please contact me at your earlier convenience.

Sincerely,

{Sender Name}

Writing A Hardship Letter Short Sale Bad Neighborhood

/0 Comments/in /by

A short sale is an agreement by which you sell your property for less than the outstanding balance on your mortgage. If your lender agrees to a short sale, it means that the difference between the two will be dismissed completely. Unsurprisingly, therefore, it is quite rare for lenders to agree with this proposal. One case in which they may consider it, however, is if you have experienced hardship due to a bad neighborhood.

Basics of Writing a Hardship Letter Short Sale Bad Neighborhood

A hardship letter is a piece of formal correspondence that will be on your permanent record with the lender. You must therefore treat it seriously. These letters are supposed to be short and to the point, including all the important information that supports your request for a short sale. The first thing to do, however, is make sure that you write it in the appropriate formal format, that it is addressed to the right individual, and that it is completely free from spelling and grammar mistakes.

Starting the Letter

Start the letter by explaining that you wish to sell the property, highlighting its address and when you purchased it. Indicate which mortgage company provided you with a loan on the property, the amount of the loan, the duration of the loan, and the type of interest rate. Make sure that you include documented evidence for all of that.

Content of the Hardship Letter

You should then go on to explain that the neighborhood in which you live has changed and has turned into a bad one. Provide dates of key events and highlight those specific events that caused the change. For instance, it is common for taxes to rise year on year (highlight the rates and dates) and that this has caused many people to relocate. Identify the results of the event, such as an increase in crime, drug use, graffiti, or squatters. Again, make sure to provide evidence.

The lender is not looking for a sob story, only for facts. However, you can indicate that you currently feel unsafe at your property, and that this has affected your children or your ability to live a normal, productive life. Both these issues can have an impact on your finances, something that you should again provide evidence for if such is the case.

You should then state that you have been offered a short sale for the property. Indicate the date, amount, and name of the prospective buyers. Explain that you put the property up for sale on a certain date, and that you believe the offer is the best one that you will be able to receive, since the situation in your neighborhood has been on the decline ever since. If there have been any foreclosures in the area, make sure that you include this information as well.

Ending Your Letter

End your letter by expressing your gratitude for your lender’s consideration and time. Explain that you are very sorry about the situation, but that you believe this to be the best solution for all parties involved. Make sure to sign and date the letter, include copies of all your evidence, and send it through registered post.

Hardship Letter Short Sale Bad Neighborhood Example

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

{Date}

To Whom It May Concern:

To Whom It May Concern:

I am writing to request the short sale of the house at {address}, which I bought on {date of purchase}. At the time, {mortgage company} provided me with a {30-year, 15-year, etc.} mortgage of {amount in dollars}, with a {fixed/variable} interest rate.

Ever since {event}, my area has become a bad neighborhood in which to own property. Taxes have increased from {rate} to {rate} per year, while the estimated value of my house has fallen from {value} on {date} to {current value}. As the neighborhood has gotten worse, my neighbors have been forced to relocate, which has led to {squatters/graffiti/drug use/crime}. I feel unsafe going out in my yard, and it has become a struggle just to pay the principal on my mortgage.

I am including the offer from the buyer I found on {date}. I put the house up for sale on {date} and I don’t foresee getting a higher offer than {amount}. Property values have been steadily declining since {approximate time} and show no signs of improving. There have already been {number} foreclosures on my block alone and the situation has become dire. I cannot meet these payments and I am steadily going bankrupt.

I would appreciate any help you can give me regarding these unfortunate circumstances. I have enclosed the relevant financial paperwork that will help to illustrate my current situation, including {explanation of the paperwork you’re including}. I would also appreciate it if we could work out a plan that doesn’t require you to make a negative report on my credit.

I hope that my plan for this short sale is amenable to you. Thank you for your understanding concerning my situation and the necessity of this modification.

Sincerely,

{Sender Name}

Writing A Hardship Letter Short Sale Marital Separation

/0 Comments/in /by

When a marriage breaks down and this results into a separation or divorce, the financial implications are quite significant. Suddenly, two combined incomes need to become two separate ones, with each covering the bills that were previously paid for by two. Additionally, there are other substantial costs associated with the marital separation, including legal costs, moving costs, therapy costs, and more. Hence, it is not uncommon for people in this type of situation to experience hardship. In fact, separation is one of the hardship causes that is accepted as a valid reason by virtually every institution.

Tips for Writing a Hardship Letter Short Sale Marital Separation

If you owned a house as a couple, you may need to sell it as part of your divorce conditions. A short sale means that you are accepting an offer on the house for less than the outstanding balance on your mortgage. If your lender accepts this offer, it means that the resulting shortfall will be forgiven. Unsurprisingly, you need to have a very good reason for the creditor to accept this. Writing a hardship letter is a formal request to do so.

The letter, which must be properly formatted and addressed and should be free from spelling or grammatical errors, you must indicate that you request a short sale. Make sure that the subject line includes your account number. In addition, also provide details about the property and its address. Also indicate who provided the original mortgage, under which terms and conditions, length, amount, and interest rate, as well as whether this was variable or fixed.

Content of the Hardship Letter

Generally speaking, hardship letters are about facts not feelings. This is true in this case, but as it is relating to a marital separation, it is acceptable for some emotive discussion to be included as well. However, overall, the lender wants to know the figures that are involved with the financial difficulties caused by your separation. You must, therefore, provide a brief explanation of the problems that have led to the separation, before highlighting the resulting extra costs (therapy, moving out, legal fees, and so on). Explain that it is not possible for either of the parties to buy the other one out of the property, which means a sale is the only remaining option.

You should then highlight that you have received an offer that would lead to a short sale. Explain who made the offer and when, and the amount offered. You must indicate that you do not believe that you will be able to get an offer that will be higher than the one you have received, and that, if the sale is not agreed to, you will likely move into foreclosure because of the hardship caused by your separation.

Ending the Letter

Finish the letter by showing your gratitude for the lender’s consideration. Show that you understand that the situation is not ideal for the creditor but it is the situation that has forced you to request a short sale. Remember that there is no guarantee that your request will be granted. Hence, always be polite and courteous, regardless of the response.

Hardship Letter Short Sale Marital Separation Examples

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

{Date}

To Whom It May Concern:

I am writing to try to request the short sale of the house at {address}, which I bought on {date of purchase}. At the time, {mortgage company} provided me with a {30-year, 15-year, etc.} mortgage of {amount in dollars}, with a {fixed/variable} interest rate.

Severe emotional and consequently financial difficulties have arisen as a result of marital problems in my home. After {brief, emotional description of family problems}, we suffered income loss due to {stress/spouse moved out/money spent on therapy}. We have worked very hard in the past to make sure that we were financially stable enough to afford the house payments, but we did not foresee the extreme emotional stress and subsequent expense issues caused by this separation.

I am including the offer from the buyer I found on {date}. I put the house up for sale on {date} and I don’t foresee getting a higher offer than {amount}. My spouse has already moved out and I am unable to meet the expenses of the mortgage, maintenance and repair on my own any longer. If I do not sell soon, I may go bankrupt.

I would appreciate any help you can give me regarding this extremely difficult situation. I have enclosed the relevant financial paperwork that will help to illustrate my current situation, including {explanation of the paperwork you’re including}. I would also appreciate it if we could work out a plan that doesn’t require you to make a negative report on my credit.

I hope that my plan for this short sale is amenable to you. Thank you for your understanding concerning my situation and the necessity of this relocation.

Sincerely,

{Sender Name}