Know the 3 critical elements of a hardship letter

A critical part of applying for a Wells Fargo loan modification is explaining and documenting to the bank that you are facing a legitimate financial hardship situation and that you can no longer afford your mortgage payment.  In order to do this, you will be required to write a letter detailing what has happened and provide that letter with your loan mod application.  Here are some important tips for writing the most convincing and acceptable explanation.

Wells Fargo Loan Modification Hardship Letter Requirements:

There are four basic categories of acceptable financial hardship situations that the bank considers legitimate.  Most borrowers fall into one of these categories:

      1. Household earnings have been reduced, for example: underemployment, reduced pay or hours, decline in business earnings, death, disability or divorce of a borrower or co- borrower
        1. Expenses have increase, for example: monthly mortgage payment reset, high medical or health care costs, uninsured losses, increased utilities or property taxes
          1. Monthly debts are excessive, over extended with creditors, including credit cards, home equity loans or other debt
            1. Cash reserves, including all liquid assets are insufficient to maintain the current mortgage payment and cover basic living expenses at the same time


              1. When you write your explanation, be certain to write your full name, property address and loan number on the top of the page.
              2. The first paragraph should clearly state that you are at imminent risk of default on your mortgage and that you are requesting considerations for HAMP or any other loan modification plan that you may qualify for.
              3. Each paragraph should cover one of the reasons explained above, many homeowners are facing one or all of these situations, so the paragraph could start:  My income has been reduced due to my boss cutting my hours at work, etc.
              4. Also state what you have done to try to remedy the situation, looking for a second job, taking in a room mate, etc.
              5. Also assure the bank that you are a hardworking, responsible homeowner but this situation is out of your control.  You want to keep you home and avoid foreclosure, ask politely for their help so you can keep your home.
              6. Finally, be sure to sign the letter and provide your daytime phone number.  The application also includes a Hardship Affidavit on which you state that you are not misrepresenting your circumstances under penalty of perjury.

              Ideally, your Wells Fargo loan modification hardship letter should be one page long, brief and to the point.  However, you do want to give enough details so that the bank will be understanding and willing to help you.  Include some details about your community involvement, church, children schools and activities.

              If you would like to help to write your own effective Wells Fargo loan modification hardship letter, you can use a template provided in the best selling resource for homeowners, The Complete Loan

              Download immediately!

              Modification Guide Kit and Loan Modification software calculator.  This helpful kit includes a step by step handbook, hardship outline, and the loan mod calculator which will generate your own sample monthly budget to help you complete your application correctly.  Visit for more information.

              Sample Budget-Automatically!

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