Writing a Good Letter of Financial Hardship For Mortgage Modification

So many homeowners are at serious risk of losing their home to foreclosure. If mortgage refinancing is not available to you,a home loan modification may be the only way you can avoid foreclosure. Right now, new Government programs make getting a mortgage modified easier than ever for millions of homeowners.

If you want to have a real chance at getting approved for loan modification, and saving your home or a lot of money, you will need to have a well written, and proper, letter of “Financial Hardship”. This letter can make or break a home loan modification approval. Often ignored, the importance of this letter cannot be stressed enough. To get approved for a home loan modification which will benefit you, you must know how to write an appropriate, and effective, letter of financial hardship.

Typically, a letter like this should include why you are facing the problems you are in, and why a mortgage modification to save your home is so important to you. Try to make it absolutely clear that unless you get a better, more affordable home loan payment, you will lose your home. This letter should not be a sob story, but a clear letter of your intent, your reasons, and your hopes.

This letter should not be a long, complicated story. A typical letter of financial hardship is usually around 1 page long. The more unnecessary details you include in your letter, the more chance of getting denied. Stick to the basics. Mortgage lenders and banks literally receive thousands of applications and hardship letters everyday. Getting your letter noticed over the other ones hinges on you being able to write a clear, brief, effective letter stating your financial hardships.

Doing the math and setting up a new budget is also important when trying o get a home loan modification. Homeowners need to have a budget which includes all income and expenses. This budget will give you a better idea of what type of interest rates, or monthly payments, you will be able to handle. Make sure you give yourself some breathing room and do not dedicate every single extra dollar to the monthly mortgage payment. In some cases, getting help from a financial advisor prior to applying may help. Especially for homeowners who have tried to start the process, but have no idea of what to do.