subject: Hardship Letters – Tantamount to a Successful Modification [print this page] Hardship Letters Tantamount to a Successful Modification
What is a hardship letter? A hardship letter is a homeowners opportunity to explain the facts and details presently in your life, to the lender, which have induced the desire and need for lowering your monthly payments via a mortgage loan modification.
Maybe you have heard about a hardship letter but have no idea where to begin, what is required in the letter, and how to present the letter to attract and separate yourself from other homeowners who are desiring the same financial help. Here are 7 steps in writing professional and persuasive hardship letters:
1st Make sure your letter is specific, short and to the point while clearly providing accurate details regarding your situation. Do not embellish your circumstance to try to manipulate the reader.
2nd The lender will need you to explain the reasons which have induced you to apply for a modification. You will want this information to be verifiable by documentation. I just read an article specifying that part of the reason many homeowners have not qualified is due to documentation. Why? Lenders want to make sure that you have the resources to honor the modification should they reduce you payment.
3rd Provide the actual dates of your unemployment, reduce in come, divorce, etc...
4th If you have any detail or information which even hints that you don't really care about keeping your home, don't expect a positive letter. Lenders want to know if the borrower is truly honest in keeping with their previous agreement. Let the lender know you want to remain in your home and that you only have not been able to make payments because of a financial hardship. If you are delinquent enumerate the causes and remember to specify dates.
5th Some lenders will require specific borrowers to receive debt and financial counseling. Let the lender know you are will to adhere to any legal requirements the bank esteems necessary in qualifying you for a modification. This will emphasis to your lender your willingness to remain in your home.
6th It is said the two most important words in our society are, "Thank you." Don't forget to express gratitude and thankfulness for the opportunity to be considered for a loan modification. There is nothing worse than a homeowner in default who is demanding and ungrateful for a situation that they may have caused themselves.
7th Remember you are contacting a professional and business institution. Be professional in your writing by having someone proof-read your letter. Remember to put your current contact information so that the lender can contact you with what they additionally require.
Under the guidelines of HAMP (Home Affordable Modification Program) here are specific hardships lenders consider that homeowners are experiencing:
1. Decrease in GROSS monthly income. This could be a result from unemployment, reduction in pay or commissions from your work, death, divorce (now a single parent), or even disability.
2. Expenses have increased. The could fall under medical expenses, ARM on mortgage has increased the interest rate thus increasing my mortgage payment beyond financial means, or increased property and utilities.
3. Monthly debt payments have become excessive (Credit cards, home equity, or other debt.).
4. Insufficient Cash Reserves. Although we have savings and some retirement, it will not be sufficient to maintain basic living and still pay our mortgage.
If you are looking to reduce your monthly mortgage payment, and remain in your home, please contact Andrew Exon for more information regarding mortgage modifications at 801-854-9838, or visit our website at LocalMod.org. LocalMod.org is an experienced and professional firm aiding and assisting homeowner's in these troublesome and trying economic times.
