| hort sale hardship letter is one of the most important | | | | child care, food, gas, insurance, auto loans, etc. |
| elements in orchestrating a successful proposal. Short | | | | Create a spreadsheet to show where you spend |
| sales are an alternative option for people facing | | | | your money. It doesn't have to be fancy, but should |
| foreclosure. This type of arrangement is made | | | | be broken down by month to provide a detailed |
| between the homeowner and lender and allows the | | | | overview of where your money goes. |
| borrower to sell the home for a lesser amount than | | | | Do not charge unnecessary expenses to your credit |
| is owed on the mortgage note. | | | | card or take out loans for a minimum of three |
| A well-crafted short sale hardship letter can | | | | months prior to filing your short sale offer. If your |
| significantly increase your chances of having your | | | | lender notices you purchased expensive jewelry, |
| offer accepted. Recent reports claim foreclosure | | | | took a vacation or spent $100 at a fancy restaurant, |
| rates are rapidly escalating. Some areas report | | | | you can pretty much kiss your offer good-bye. This |
| increases as high as 57-percent. | | | | is not to be interpreted as suggesting you hide these |
| Today, lenders are receiving short sale offers at an | | | | charges. In your hardship letter you can express your |
| alarming rate. Experts suggest only one out of ten | | | | remorse and explain the steps you are taking to |
| proposals are accepted. In order to stand apart from | | | | change your spending habits. |
| the crowd it's imperative to create an organized and | | | | Organizing your information beforehand will provide |
| well-documented short sale package. | | | | beneficial insight that you can include in your hardship |
| In order to apply for a short sale, the first thing you'll | | | | letter. If you're facing foreclosure, chances are you |
| need to do is contact your lender's Loss Mitigation | | | | are embarrassed by the situation. You might be |
| Department. Individuals who work in this department | | | | tempted to hide or sugar-coat the truth. However, |
| are known as Loss Mitigators. A personal mitigator will | | | | when it comes to a short sale, the Hardship Letter is |
| be assigned to your account and will work with you | | | | the document that can make or break your deal. |
| to resolve the situation. They may offer other | | | | Experts suggest hand writing your hardship letter. A |
| options prior to allowing you to apply for a short sale. | | | | hand written letter on notebook paper is more |
| Organizing a short sale package will vary from lender | | | | effective in sending a message that says, "I need |
| to lender. However, most will request the following: | | | | help." If you have illegible handwriting, ask someone |
| 1. Financial Statement providing proof of income and | | | | to hand write the letter for you. |
| expenses | | | | Use a business-style format when writing your letter. |
| 2. Hardship Letter | | | | At the top include the date, your name, address, |
| 3. Recent checking, savings and investment | | | | phone number and email address, if you have one. |
| statements from all borrowers | | | | Next include the name of your lender and your loan |
| 4. Documentation proving the real estate listing | | | | number. At the end of the hardship letter include |
| information of the property | | | | your signature and the signature of any co-signers, if |
| 5. Signed Sales Contract | | | | applicable. |
| 6. Estimate Settlement Statement (HUD-1) | | | | The body of the hardship letter will be used to tell |
| 7. Proof of buyer's financing | | | | your story. This is the place to explain the series of |
| Keep in mind that lenders and banks are in business | | | | events that caused you to fall into financial ruin. It |
| to make money. Accepting a short sale offer will | | | | should present an emotional plea that says, "I am in |
| cause them to incur a loss. The contents of your | | | | distress and I need your help." Close the letter by |
| short sale package must prove to your lender you | | | | expressing gratitude and thank them for taking time |
| are incapable of maintaining your mortgage payments. | | | | to review your offer. |
| You need to show them how accepting your short | | | | If you believe short sale is a good option for you, |
| sale offer will benefit them. How do you accomplish | | | | consider working with an experienced professional. |
| this? | | | | They can assist you in organizing your offer and |
| First, gather your financial records including bank and | | | | become involved in negotiations with your lender. |
| credit card statements, utility bills, medical expenses, | | | | |