Many people are finding it difficult to explain why or how they came to be in a position of struggling to meet their mortgage payments, problem is if you are applying for a loan modification then this part of the requirement and you have to provide a reasonable and honest explanation for why you are struggling.

You will find a template for putting together a hardship letter in one of the previous posts on this site called Hardship letter template for a loan modification request.

For further information I have included a link at the top of the page to an article that explains what information you need to add to a hardship letter when explaining how you came to be in financial difficulty. The article is very well written and tells you exactly which questions you need to answer with respect to explaining your difficulties from a lenders perspective, which is of course the perspective you need to understand and satisfy.

This article is primarily concerned with the short sale process, but the questions asked will also satisfy the needs for a loan modification request, they are in effect the same reasons but for an alternative process.

So if you are struggling to explain and need a helping hand then please refer to this additional source of information.

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It may be possible that the bank has a hardship form of some sort that you can fill in, which would be useful as then all you would need to do is answer their questions honestly and explain how you came to be in a situation of not being able to afford your mortgage payments.

In the absence of a form however it is a really good idea to use hardship letters that follow a template to include all the information that the bank or lending agent would expect you to provide, a sort of hardship letter sample.

Below is a request letter template that shows you how to construct a letter for this purpose.

First and foremost make sure the letter is legible and easy to read, if possible use a typewriter or a computer and print the letter out.

Provide all your contact details including, name, address and phone number as a minimum, if you have it you can also provide an email address.

Whenever you are writing a hardship letter to stop foreclosure you must include the reference details supplied by your lender for your mortgage, it could be an account number or an alpha/numeric reference that they have supplied you with. Find it on the letters they have sent you and make sure that you use it, that way they will know exactly who they are dealing with amongst the thousands of people who will be writing to them.

They will also require the additional information below which will need to accompany your letter:

• Details of your gross monthly income, include a recent pay stub if possible and also provide documented evidence of any other earnings.
• Your most up to date income tax return.
• Any collateral or valuable assets you have
• Tell them about any second mortgage on the house.
• How much you owe and the minimum monthly payments you have to make on all credit cards.
• How much you owe and the monthly payments on any other debts such as car loans.

It is important to write the letter and send the additional information as soon as possible and before the lender signs the ‘Default Notice’.

You should put the whole package together and send it using registered mail that includes a receipt of receiving. That way you will know when it has been delivered and you can follow up a day or two later with a phone call to find out if your request is being processed. That will demonstrate that you see the problem as urgent and that you fully intend to try and resolve the situation, but always be polite when you call.

If you do everything you can to help the lender understand your situation, provide all the information they need and remain calm and polite, there is a good chance that they will respond to you positively. They are human after all and humans tend to treat people the way they are treated, if you help them they will help you.