Financial Hardship Letters – Being Honest and Truthful Will Save Your Mortgage
The more detail that is provided in hardship letters the better. Give examples of how you have tried to come up with the funds in order to make the mortgage payments. Mention methods like using your savings and retirement funds or even renting a room out in your house for extra income. If you have a large family and could not rent a empty room then bring that up as well.
Explain that after you have exhausted all possibilities you were left with seeking assistance from the lender – you had no other choice. Remember to have a personal tone and be as detailed as possible.
It should be a heartbreaking story.
While writing the hardship letter it is important to think about the fact that it will be read by a human being. There will be some compassion needed by them when they make their final decision to reinstate the mortgage. You must play to that compassion to get them to sway the decision in your favor.
In addition, in the hardship letter you should ever so delicately mention to the lender that working with you will be better overall then allowing the house to go into foreclosure proceedings. It is important to assure the lender that your current financial condition is only temporary and you are truly interested in staying in your house.
Prove to them that in a short period of time your situation will improve and you will be back to making regular monthly mortgage payments again. If this time frame is six months or less the lender will be more inclined to work with you.
An important piece of advice is not to tell lies or make false promises in the hardship letter. The banks and other lenders hear lies and stories all the time – they will know. It is important to back up all your statements in the hardship letter will supporting documentation. This includes but is not limited to:
- Pay Stubs
- Credit Card Statements
- Bank Account Statements
- State and Federal Tax Returns
- Other Loan Documents
- Retirement Saving Statements
- Credit Reports
Use any documentation related to your financial condition that you have access to in order to substantiate what you say in the hardship letter. These documents are also an excellent way to draft the letter. For example, you could maybe have a paragraph for each explaining more details about the document.
Remember that the lender went through your financial condition, including your credit reports, when they issued your mortgage. However, this time they will go through the same process but more thoroughly. If you lied on your loan application and they find out you can be prosecuted for mortgage fraud and your hardship letter will be declined.
The key is to be truthful no matter how bad your current situation may be. If you are truthful in your hardship letter and prove it with documentation you stand a greater chance of being accepted by the lender.There are many expert techniques that you can use to accomplish what is set out in the hardship letter.
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