What Is Financial Hardship Assistance?

Financial hardship assistance is sometimes offered by mortgage lenders to those who are in trouble with their mortgages. Mortgage companies typically want to keep from foreclosing on a home just as much as homeowners want to keep from it. They know that if they do not have a mortgage payment coming in, it will hurt them financially in the long run. Therefore, it is in their best interest to work with borrowers when they get in trouble. Here are the basics of financial hardship assistance and how it works.

Extenuating Circumstances

Financial hardship assistance is offered to those that have been subject to circumstances beyond their control. In order to qualify for financial hardship assistance, borrowers need to inform lenders of the details of what has happened and how he or she plans to avoid a similar situation in the future. This is usually conveyed through a financial hardship letter that is written by the borrower. 

What Is Offered

If it is determined that the borrower meets the qualifications for financial hardship assistance, the lender could do a number of different things to help. The lender may be willing to forgive late payments and help the borrower get caught up. They may change the interest rate of the loan or lower the payment.