One of the required steps to qualify for a loan modification is writing a hardship letter. This is a brief explanation of the circumstances surrounding your current financial status, and will let your lender know what has happened to cause the situation and also what you have done to try to overcome it. The federal government requires every homeowner who applies for a loan mod to submit this explanation letter, and there are certain important categories that you need to be sure to cover.
Here is a sample that you can follow with the important phrases highlighted-of course you need to personalize this to match your own circumstances and so that it fits your unique situation.
Loan #, Borrowers Names, Property Address
To whom it may concern,
I am writing this letter to explain my current financial hardship situation and to request consideration for the loan modification program. My mortgage payment is no longer affordable and I am at imminent risk of default if I do not receive some help.
The trouble first started about 6 months ago when my hours were cut at work, and my income was reduced. My wife was laid off from her job, so as a result we lost more than half of our normal income. She has been looking for work but has not been able to find anything, and I have also been looking for a second job. The economy is very bad in our area, and there are just not many jobs available making it very difficult for us.
We have been using up our small savings account to make ends meet each month, and now we have begun having to use credit cards to pay our monthly expenses. We will soon be out of money, and the increased payments on our credit cards are so high that we cannot afford to keep paying those either and our monthly expense keep getting higher.
Our home has lost so much value that we cannot qualify for any type of refinance program, and a loan modification is our only option. We do not want to lose our home, our children are involved in their school and church and have many friends in the neighborhood. It would be heartbreaking for us to have to uproot them.
We are hard working, responsible homeowners and we have tried everything we can think of, but we are desperately requesting your help to modify our mortgage to a more affordable payment. We would like to be considered for a loan modification plan-please help us to keep our families home. Thank you,
Sign, phone number
The loan modification requires that you also complete the official application form which is called the RMA-Request for Modification and Affidavit. Page 2 of this form is the monthly budget for your household, and this is where you must breakdown your income, expenses and bank balances. You must show the right amounts or you will not qualify. If you are not sure how to prepare your monthly budget form correctly, you can use a sample monthly budget to follow. This will show you how much income, expenses and bank balances are required to fit the approval guidelines for loan modification.
Need help with your loan modification application? Do it right-use the #1 resource for homeowners, The Complete Loan Modification Guide kit and loan modification software calculator. You receive everything you need to
succeed: step by step directions, required forms and the loan mod calculator automatically generates your own sample monthly budget to show you how much income, expenses and bank balances are required. Visit MyLoanModificationCenter.com for more information today.