Digital News Report – Homeowners have been struggling to make ends meet, but despite their best efforts an unexpected expense or hardship may put the borrower in a bind.
The purpose of the hardship letter is to explain the situation and to ask for help. The homeowner may want a temporary modification of the loan.
There are many reasons a homeowner would want help. Keep your letter on topic, explain your situation and ask for what you want. Don’t blame the economy. Keep it simple.
Perhaps you lost your job, or your wife or husband lost their job. The business could have failed or the business is experiencing a reduced income. Include the address of the lender at the top and your complete name and address at the bottom.
Include your loan origination number or account number. You need to make sure they can identify your mortgage account. You may want to phone the bank and find out who you should address the letter to. You don’t want your letter misplaced.
Be specific as to when you need the help. For instance, you may want to make reduced payments between February and June. Always TYPE IT.
Here is an example:
123 Maple Dr
City State Zip
Loan account number: XXXXXXXXXXX
To whom it may concern (the person’s name would be better),
My wife has lost her job and we will have reduced income for the next four months. She has begun applying for new job and we expect her to get employment within the next two months.
We would like to modify the terms of the loan from February until July of this year. Our payments are currently $XXXX per month and we would like to temporarily reduce those payments to $XXXX until our July payment. At that time we will be able to make payments in full.
We look forward to your response and hope to be able to work with you.
City State Zip
Modify the letter for your specific situation. Typically servicers and banks don’t want to modify the loan, even temporarily. The bank may make a counter-offer. The bank may want you to make a balloon payment at the end of the modification period for the balance. That could be hidden in their response.
Keep all responses and good luck.
By Tina Brown