What Is A Hardship Loan Modification And How Can It Help

When a homeowner is facing foreclosure he or she will be willing to do almost anything to keep from losing their home.  The good news is that most mortgage lenders will work with the homeowner to be sure that they will not lose their home.  In fact many lenders would rather work with you than have to deal with a foreclosure.  This is because when a foreclosure happens both party will win and the lender will lose a large amount of money.  This is why they are willing to work closely with you to see what kind of arrangements can be worked out.

Reasons For A Hardship Loan Modification Request

If a homeowner has a valid hardship reason a hardship loan modification can be made to help the homeowner stay in their home.  The tough question is what qualifies as a valid hardship.  When working with most mortgage lenders it is found that they believe in the same types of things as a hardship.  These are being laid off from your job, being in the hospital, getting divorced or having another legitimate reason why you cannot work to pay your mortgage.  Another common reason for a hardship loan modification request is when the interest rate on the mortgage loan is very high.

The Steps To Obtaining A Hardship Loan Modification

The first step in the process of obtaining a hardship is to write a hardship letter.  This letter should explain in detail every circumstance that is surrounding the hardship you are currently in.  It is important that the homeowner keep the letter short but to the point and should not blame the lender for the problems.

Another item that should be included with the hardship letter is a detailed copy of the homeowner’s finances.  This should include proof of income as well as tax returns and monthly bank statements.  These requirements will vary with each bad credit lender but these are the basics.

Have An Attorney Or Loss Mitigation Specialist

When you are preparing the hardship modification information it might be helpful to hire an attorney who specializes in this area or meet with a loss mitigation specialist to help prepare the modification request.  These professionals do these hardship modification requests on a daily basis and will know exactly what the lender will be looking for and give clear advice to the homeowner.  They will also have the experience to put the request package together so that the lender will take the request seriously and hopefully grant you the modification.


If you are a homeowner and you are going through a hardship it is recommended that you request a hardship loan modification.  The sooner you start the process the sooner the modification can get into place.  This is a long process that may take several months so it is important that you do not wait until the home is started in the foreclosure process to start.

There are plenty of professionals standing by to help if you have questions or need additional help in completing the packet.  Do not be afraid to ask for help.  After all having a roof over your head is more important than asking for help.

Friday, September 19th, 2014 Uncategorized

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