5 Tips for Writing a Financial Hardship Letter

If you are going through the process of a loan modification or short sale, a financial hardship letter will be a large part of the equation. When you go through one of these processes, the lender wants to know why you are asking for their help. The financial hardship letter allows you to convey to them exactly what went wrong. It is your best way to communicate to them and ask for their help. While it is an essential piece of the puzzle, many people have no idea what to include in the letter. Going through a loan modification is most likely a one-time occurrence for most people. Therefore, this is often foreign territory for most. Here are a few tips for writing a financial hardship letter and what you need to include. 

1. Be Detailed

One of the biggest things that you need to remember when writing a financial hardship letter is to be detailed. This does not mean that you need to be long and drawn out with your explanations. You just need to give specific details about why things went wrong. If something really bad happened, you need to tell them. Do not give vague generalizations like "We have had a rough year." Tell them what happened and get to the point.

2. Be Brief

While it may not seem possible to be detailed and brief at the same time, this is exactly what you need to try and do with a financial hardship letter. You need to keep your writing to a minimum. Your lender does not want to read a novel when determining whether or not to give you a loan modification or short sale. They want to hear what you have to say and then go about their business. Try to keep it brief throughout your letter. 

3. Evoke Emotion

While you want to address the facts, you also want to try and evoke as much emotion as possible. The person that is going to be reading your letter and making the decision is a human too. They have feelings and they still use them regardless of how high they go in the bank. This means that you should try to appeal to the human side of them as much as possible. 

4. Ask For Help

At some point during the letter, you also need to tell them exactly what you want. If you write a long, drawn out narrative of what went wrong, it will do you no good unless you tell them what you want. If you are after a loan modification, tell them so. If you want a short sale, let them know that instead. Just make sure that they know why you are writing them. 

5. Be Grateful

Throughout the letter, you need to express a grateful attitude. The person on the other end of the letter does not want to feel like you think they owe you something. Tell them "thank you" for reading the letter and for their help. This can make a big difference in the mind of the decision makers.

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