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How To Write A Hardship Letter

Before any bank will approve your loan modification or short sale, the lender will ask to see a hardship letter written by the homeowner. Our goal at The Fair Program is to help guide you by providing you with the pivotal aspects of the hardship letter so that you’re approved the first time. Nothing is more of a letdown than knowing that by avoiding a simple mistake you could’ve prevented a denial.  This guide will offer tips on creating an ideal hardship letter and also example templates to get you started!

Hardship Letters are Hope

Writing a hardship letter may not seem like a lot of fun. You may think recalling your losses is deeply depressing when you start writing down how bad life has become since taking a financial backslide, but the reality is your hardship letter is a chance to get back on the write path.  Writing a good hardship letter could mean receiving the mortgage modification you need to get back on track. So no matter what, remain positive about the possibilities you have going forward. There is hope on the horizon.

Keep It Simple

It’s important not to think of your hardship letter like an appeal to a counselor or friend. There is no need to try to capture your disappointments, hopes or sadness to sway the lender. This isn’t any of their business—and keeping the hardship letter simple means keeping your letter strictly business.  This can be very easy to do by going through each line of your letter and asking yourself if the content written is fact or opinion/appeal?

Examples of Hardship

The list of considered hardships available to you is pretty cut and dry with respect to lenders. You want to make sure that if any of the following circumstances applies to you, it will be included in your letter:

  • Significant or Severe Illness
  • Loss of Job
  • Reduced Income
  • Failed Business
  • Job Relocation
  • Death of Spouse or Co-Borrower
  • Death
  • Incarceration
  • Divorce
  • Marital Separation
  • Military Duty
  • Reduced Income
  • Medical Bills
  • Damage to Property (natural disaster or unnatural)

Once you’ve figured out your hardship, creating a letter to support your claim is the goal in completing a solid hardship letter. While the hardship letter is just one piece of the loan modification process, it is key in helping you avoid foreclosure.


Example Hardship Letter

Name: (Your Name)

Address: (Your Address)

Lender Name: (Your Lender)

Loan #: (your Loan #)

To Whom It May Concern:


I am writing this letter to explain circumstances that have caused us to become delinquent on our mortgage. We have done everything in our power to make payments but unfortunately we have fallen short and would like you to consider a modification of our loan. Our number one goal is to keep our home and we would really appreciate the opportunity to do that. It is our full intention to pay what we owe.

On (insert approximate date of hardship), we experienced (insert your example of hardship) and we believe that our situation is (Temporary or will be Permanent.) As a result, our income is not nearly enough, and we have fallen further and further behind. We have reached a point where we cannot afford to pay what is owed to (lender). At this time we have exhausted all of our income and resources and are turning to you for help.
We would appreciate if you can work with us to lower our delinquent amount owed and or payment so we can keep our home and also afford to make amends with your firm.

We truly hope that you will consider working with us and we are anxious to get this settled so we all can move on.

Sincerely and Respectfully,


Borrower’s Signature


Co-Borrower’s Signature

September 7, 2007

Click here to download a Hardship Letter template in Microsoft Word!

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