How not to write a loan modification hardship letter

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How not to write a loan modification hardship letter

Moe Bedard, whose advice on approaching his servicer this borrower faithfully followed, wasted not a moment in "reaching out to the media" with this story, managing to land it in the LAT yesterday.

As a PR stunt, there's not much you can criticize here about Mr. Bailey's letter or Moe's media-savvy frothing in response.

how not to write a loan modification hardship letter

Angelo just handed these folks a dose of self-righteousness that will keep them stoned for weeks. The problem here, of course, is that if you are a borrower in distress trying to work something out with your servicer--Countrywide or anyone else--your primary need is not sympathy from the senior execs or attention from the press office or a flap in the newspaper.

Your primary need is to reach a person in default servicing who can do something about your problem. This person needs to understand very clearly what your problem is and what can, practically, be done about it.

At the risk, therefore, of sounding like a shill for Countrywide this is a blog in-joke; every time I write something insufficiently hostile to CFC I get accused of being an "industry shill"I offer to use what insight I have into the minds of loss mitigation specialists who deal with these things to offer some advice on how to write a letter that runs much less of a risk of being dismissed as just another sympathy-seeking form-letter.

Some people can't quite get a handle on this point, but you need to. Your goal is to convince the servicer that what you are asking for--in this case, a modification, although it could be a deed-in-lieu or a short sale or just a temporary repayment plan--is 1 necessary given your financial situation and 2 going to work.

The biggest problem I have with Mr. Bailey's letter is that it does not ask for anything specific and it does not help me see why a modification would actually work in his case.

In fact, it makes the mistake of suggesting that a modification would only allow Mr. Bailey's shaky income situation to continue or get worse. That being the case, it doesn't really matter if the person reading your letter feels sympathy for you or believes that the situation was truly beyond your control.

Let's start at the beginning: To Whom It May Concern: I am writing this letter to explain my unfortunate set of circumstances that have caused me to become delinquent on my mortgage.

I have done everything in my power to make ends meet but unfortunately I have fallen short and would like you to consider working with me to modify my loan. My number one goal is to keep my home that I have lived in for sixteen years, remodeled with my own sweat equity and I would really appreciate the opportunity to do that.

I moved into this home in May of …this was the same year I got clean and sober from drugs and alcohol, and have been ever since, this home means the world to me.

The first sentence of this letter encapsulates what's wrong with it: Everyone who talks to the Loss Mit department has "unfortunate circumstances. It is very hard for people in financial distress not to focus on their own misery, or to imagine that the "uniqueness" of their misery is not really the point.

You need to get beyond that. You may think it is "unfair" that your story sounds more or less like everyone else's. Servicers do not modify loans because they feel sorry for you.

They modify loans because you have convinced them that you will be able to make payments that way. A much better first paragraph would be: I am a long-time homeowner and am committed to staying in my home if we can work out terms that are practical for both of us.

It gives the Loss Mit people a clearer idea of what you want. And it hopefully sets a tone that keeps you from degenerating into irrelevancy or sympathy ploys. No one needs to know that you had a booze or drug problem prior to Certainly no one needs this hint that your property is old, obsolete, and probably filled with DIY "remodeling.Write A Loan Modification Hardship Letter With Samples Mortgage Modification Hardship Letter – Word Document Among the things your lender will ask for you to supply during the loan workout procedure is a loan modification hardship letter.

Oct 03,  · Example Hardship Letter One of the items your lender or servicer will ask for during the loan workout or loan modification process is a hardship letter.

A hardship letter is a written explanation as to what has caused you to fall behind on your mortgage and it vital in helping you stop foreclosure. We have tips on writing hardship letters as well as hardship letter templates. Sample Hardship Letters. Writing a Hardship Letter for a Loan Modification; How to Write a Hardship Letter for a Short Sale; Letter of Financial Hardship: Possible Recipients;.

Whether you are requesting a loan modification or a short sale, your lender will most likely ask you to submit a hardship letter. The purpose of the letter is to describe, in the homeowner’s own words, why the homeowner is not or may not be able to make his or her mortgage payments.

I am writing this letter in support for my loan modification plan for the {mortgage, loan, etc.} on the {home, car, etc.} located at {address}. My intention is to stay in my home, and my hope is that the loan modification will allow me to get my loan in order and back on the right path. A hardship letter is like a lawyer's brief.

This written explanation to your mortgage lender, detailing why you wish to do a short sale or to modify the terms of a loan or mortgage, has to build a case for a decision in your favor.

How to Write a Hardship Letter for Mortgage Loan Modification