Loanmod Approval

Hardship Letter Guidelines

I’ve read several blogs on the internet on what a hardship letter is and how you should write a hardship letter for a loan modification.

A hardship letter for a loan modification should be written carefully. It is designed to quickly tell the bank what you are going through, or what you have gone through that has made your ability to pay your mortgage very difficult. You don’t want to divulge too much information about your hardship situation or your financials. Again, too much or too little information will work against you, not for you.

I’m going to keep this very general and simple.

Start off by explaining the hardship you are suffering from. Briefly explain why you have fallen behind or why you are struggling to make your current payments. (You may not want to include any dates of when the hardship took place, unless it is fairly recent or still ongoing. But, you can say, I lost my job in the summer, etc… Remember a loan modification is to help those in a hardship today, not 1 or 2 years ago.)

Next, let the bank know that you are committed to keeping your home and will make every effort to start or continue making your payments to them.  (Just because you send a hardship letter, that doesn’t let them know you are asking for a loan modification. They need to see in writing that you are asking for a loan modification or that you want to keep your home. Otherwise, they could accidentally forward your application to the Short Sale, Deed In Lieu or the bank’s refinance department. The last think you want is to prolong the process any longer than it already is).

Conclude by letting the bank know how a loan modification can help your situation. Ex: A loan modification will help me get through this hardship and put food on the table…Thank the bank for their help and end the letter with your printed name, signature and date.

Now, here are some very important details you need to know about the hardship letter. The hardship letter is simply designed to quickly let the bank know what the hardship is so they can consider you for a loan modification. I recommend that you DO NOT include any figures of any kind. Do not state any figures relating to your income, assets, expences, not even the number of people you have in the house. You don’t want to include any predictions or projections into your letter either. Telling the bank that you may get a settlement in a couple months or you will get a big contract and will make a lot more money only tells the bank that your hardship is very temporary and there is no reason to consider you for a modification. As far as excess expenses that may have gone up, again, do not include figures. You can say that your expenses have gone up but, that’s as far as you want to go with that.  You want to keep the hardship letter straight forward and no more than 1 page if possible. Leave anything out that may be questionable. Adding figures will raise plenty of questions. Predicting the future or making projections will raise questions as well and, in most cases cannot be proven or supported.

As I stated earlier, the information here is very general. I thought about posting up a hardship sample but, the template may end up being overused and could potentially become too familiar to the banks.  You can easily do a search on hardship letter and you’ll get plenty of samples online. But, follow the guidelines above when you write your own letter to ensure the bank will clearly understand what you have to say. Everyone’s hardship is unique to their situation. So, there is no right way to write one. If you want a 2nd opinion, feel free to post your hardship letter here or send it to LoanMod-Approval for review and advice.

• Steps to a Home Loan Modification with Bank of America Loan Modifications seem to be the last hope for a number of homeowners across America who are struggling with their mortgage payments. This is ever more clear with the rising foreclosures that is expected to...
• Loan Modification: Can an Ebook help? Loan Modification ebooks: A waste of money? Believe it or not, Loan Modifications may still be in it's infant stage. Most banks have only just started doing loan modifications back in 2006 or 2007 and...
• Loan Modification firms don't modify loans, BANKS DO! When you do a search online or in the phone book for companies that offer loan modification service, you'll find that there is no shortage of companies and law firms offering this service. Some of...
• Take matters into your own hands! But, how do you show the bank you need a loan modification? The secret to a loan modification is how you present the modification package to your bank. If you are considering hiring a firm to help you with a loan modification or you are planning on...
• MHA Trial Plan Most banks are currently offering loan modifications in one form or another and many are participating in the Government's MHA - Making Home Affordable modification program. Also known as the Obama Plan or the HAMP...

• Looking at Debt Consolidation Companies Many of the people that would like to find a way to complete a loan consolidation to reduce their debt quickly do not understand the importance of finding a good loan consolidation company.  There are...
• Start Making Money Online Now. There are lots of unemployed people nowadays and they struggle hard to find a job. The first step is to create a resume, then you will apply to the numerous positions you find attractive, then...
• What Happens When The Banks Pay Back TARP Money? Goldman Sachs says they're ready to pay back TARP money, but what happens once they do it? To some of you I'm sure there is nothing that gets your jollies going better than a juicy...
• 7 Handicaps that are Killing the Banking Industry While sitting in my office I come across all sorts of problems with the banking industry.  I've stated one of my goals is to play a part in making banks and financial services less like...
• Tips for Paying Off Student Loans Right now, the student loan industry is going through one of its worst periods in decades. New Federal regulations have forced many banks to stop offering student loans, and students are being forced to either...