Hardship Letter Writing Secrets

Part of your credit card debt management strategy may need to include hardship letters written to your creditors. Hardship letters are mainly written to qualify for mortgage loan modifications, but a well written hardship letter can help with any kind of debt. No matter what kind of debt you have, I have found a great article for writing better hardship letters. Here it is in its entirety…

After fulfilling orders for hardship letters for few years I got so many questions that I decided to give the answers, here. First, a few words about my background. I started my career in corporate America, but a few years ago decided to start my own business.

As helping other people was my main direction I decided to get a Masters in Psychology and then began working with divorcing couples. Not a secret — divorce causes families to take on another home without an increase in income. I got many of my former “divorce” clients coming back for help with their hardship letters as they knew how I work.
I really began researching this simply because some of my clients asked me to. I talked to folks I knew in the mortgage industry and also did a bunch of on-line research.

Things have now become very busy since the Obama administration announced new regulations about two months ago.

Hardship letters have similar functions to cover letters when applying for a position at a company. The cover letter gives more details about you and tells why you think the position is right for you. A hardship letter plays a similar role in being an integral part of the whole package. Its main aim is to highlight:

a) what changed in your financial situation
b) what are you asking for, and
c) how can you be making payments if new conditions will be approved

If you have collected all the financials, is the letter is still important? Sure it is! One reason it is needed is that lenders don’t just modify loans for the heck of it. Compared to keeping initial terms making new ones will always cost more for the lender. The only reason for lenders to change the contract is that you really cannot keep the terms because of your hardship. Your financials must support the points you make in your letter, but the hardship is the primary reason you apply for the modification.

The purpose of the letter is to state, as clearly as possible, what caused you to not be able to keep the initial terms, what arrangement you looking for now, and how you will be able to meet the new terms of the agreement.Being excessively emotional in your hardship letter won’t help. Real hardships normally speak for themselves.

People sometimes have misunderstandings about what a hardship letter can do. They mistakenly think that:

- it can stop a foreclosure
- the letter will get them a modification even if they can’t afford to make the payments
- the letter will allow them to bypass the normal approval process
- the letter can work miracles in saving a failed situation

Yes, sometimes, situations aren’t entirely clear. In those cases, I suggest you submit the letter anyway, because you never know what might actually happen. It doesn’t hurt to try.

What must be included in your hardship letter?

- an explanation of the hardship that is caused you to miss your payments or to renegotiate your loan, even if you haven’t yet missed payments.
- what you want to come to agreement on, now.
- why this new plan makes sense.

What shouldn’t be in your hardship letter?

- blaming others – the lender, your spouse, your kids, your employer…
- mention of legal issues, mental health issues, addiction issues, etc.
- stories that portray you as unable to manage your financial life.

My letters usually follow this flow:

- an explanation of the situation and its history, if that makes sense.
- the request – what you want to have happen now.
- a clear, succinct explanation of the hardship.
- why the new plan will work.

Many people make the following mistakes:

- procrastinating in writing the letter (or getting someone else to write it).
- giving reasons for missing payments that don’t constitute a valid hardship.
- not having a plan that works.

While Internet is full of advices an information on how to write hardship letter, I still constantly get clients ordering letters to be written for them. The reasons I’m hired are sometimes obvious, like when someone has native language other than English or they have grammar and spelling challenges. However, many ask me to write their letters simply because they:

a) just can’t get to it in a focused way
b) don’t feel the they know how to say what is needed in a way that will be understood, clearly

Sometimes, it’s much easier for an objective third party to express your story than to try to express it clearly, yourself.

You will get your hardship letter written in 2 business days. To see if you qualify, please visit http://www.hardshipletterin2days.com

By Sylvester L Bird

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