Hardship Letter Basics
A Hardship Letter is usually part of the package that a potential short seller must put together for the bank. Hardship letters describe the sellers current
financial condition, and usually those choices involve the situations that have lead to the need to sell the home and not pay the bank. These letters are used by the bank to determine, primarily, that a short-sale is in the banks best interest, as given the information in the short-sale, they will likely be foreclosing soon.
Reasons to Think about the Hardship Letter ahead of Time
A Hardship Letter is a Math Problem
Hardship letters are not emotional letters about how the bank should relieve you of your obligations because you are in desperate straights. Remember, the bank's decision to accept a short-sale arrange for them is a math problem - it's simply the cheapest way for them to get out of an under performing asset. Your hardship letter
Related Articlesshould also be math oriented, focusing on your assets, your income, your debts, and your cash flow. The more likely it looks like you are in a financially untenable situation, the more likely the bank will consider a short-sale. That doesn't mean you should overstate the situation, remember, banks have ways to check many aspects of your financial situation, and the hardship letter should just help them connect the dots.
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*All information is posted in good faith and is assumed to be reliable, but may rely on third party information sources.