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Sample Hardship Letter 

Written by: Kristy Welsh

Use this sample hardship letter to ask for a mortgage loan modification. 

Before a bank will approve a short sale or a loan modification, the bank will want to see a hardship letter. A hardship letter is a document that must be created in your own words. Basically you want to get across to the bank that you did experience a hardship but are looking to resolve the situation with their help. Think back to when you took out the loan and what you life was like then — what is different now? Some examples that may qualify for a hardship:

  • Unemployment
  • Reduced income
  • Illness or medical emergency
  • Job transfer (voluntary or involuntary)
  • Divorce, separation or marital difficulties
  • Exotic mortgage terms, i.e., an adjustable-rate loan
  • Military service
  • Death in the family
  • Incarceration
  • Increased expenses and excessive debt
  • Unexpected repairs or home maintenance

In your hardship letter, you want to explain 3 things:

  1. How you got into your present situation (explain what has changed since you look out the loan)
  2. What you have done to try to get out of this situation
  3. Why this situation is permanent and how nothing you can do will change it

The following letter is just an example — DO NOT CUT AND PASTE THIS LETTER. Your hardship letter need to be in your own words explaining your unique situation. If you need more information on short sales or loan modification,  check out our loan restructuring article. We also have other sample credit repair letters to handle a variety of credit situations. Here is the list.

To Whom it May Concern:

I am writing this letter to explain why I am currently facing foreclosure on my mortgage to you.

I am very distressed that this has ever happened to me, but I was [laid off], [seriously injured], [going through a death in family] . The circumstances drained my carefully put aside savings and in order to provide for my family I was forced to choose between mortgages payments and food. My financial advisor told me not to tap into my 401K.

This is a very embarrassing to me, I have always prided myself in paying on time, and I have taken steps to put away money in my savings account to guard against other unforeseen occurrences like this. I guess I just did not put away enough. As a good faith payment, I would be willing to do a partial distribution from my 401K towards the loan restructuring. Staying in my home is very important to myself and my family.

My wife and I have sat down together to review our finances and believe we could safely accommodate a payment of $1,875/month over 30 years should you approve our loan restructuring.


Your Signature

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