How Can You Compose a Hardship Letter for Loan Modification?

A hardship letter for mortgage loan modification is an essential step in requesting for a modification of mortgage loan. Lending and financing institutions should review the financial hardship of the applicant to determine his/her eligibility for adjustment of home mortgage loan.

Here are the instructions to follow how to create a hardship letter as a prerequisite in requesting for loan modification:

1. Before you start to make your hardship letter, you have to research first on the guidelines on loan modification to determine your eligibility. A few of the guiding principles are the following:
• The onset of the mortgage must be before on January 1, 2009
• Home should be owned individually that means the applicant is the owner of the home
• Home should be occupied
• The house must be your primary residence
• The lender should have curbed to an agreement with the treasury

2. Make a research on what hardship details are required by the lending institution to approve your application for modification of loan. The following are some examples of the details:
• Total amount of the mortgage expenses
• Kind of mortgage
• Date the mortgage was entered
• Gross monthly household income
• The actual value of the property
• Status of your loan payment

3. Include in your letter all pertinent data like the mortgage address, number of the loan and contact information to facilitate easily your loan.
4. Explain briefly hardship that includes financial implications, date of loan, and anticipated period of the loan in your letter for loan adjustment.
5. Provide the monthly mortgage operating expenses called the PITIA comprising principle, taxes, interest and insurance (hazard, homeowners and flood).
6. Present in your letter the gross income statement per month, utility bills, and tax returns to facilitate the easy processing of your loan modification request.
7. The lending institution will utilize these numbers stated in your hardship letter to form a correct DTI (Debt to Income) ratio in order to evaluate if your difficulty meets the target requirement to qualify a mortgage loan adjustment.

The lending institution will really grant your request if you can compose an honest hardship letter for mortgage loan modification.

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