Hardship letter

[Mariel]

Hello everyone,
We have a 80/20 ARM loan that was transferred to Chase 2 years ago. We fell behind when our business closed and we filed bankruptcy last year. We accepted a bad forbearance deal, and borrowed money from family in order to keep the house from foreclosing. We somehow got back on track, and have not had a late payment since December 06. I am self-employed in the food business, and my wife has a steady income. Business has slowed down dramatically in the past couple months, and as a result, we are 1 1/2 month late in our mortgage payment, and our rate will be adjusting in October, making our payments $600 higher. I am currently looking for permanent employment, but nothing yet.

I contacted Chase and they suggested that I send in documentation for them to see if they can modify our loan. This is our only option - I pray that this works. Before I send the hardship letter, I am doing some research to make sure it says what it needs to say. It sounds like everything depends on that letter. If you have a sample letter, I would really, really, appreciate it if you could post it, so that myself and the others in the same situation can write a good letter and increase our chances. Also, what kind of ratios do you think makes for a good candidate for loan modification?
Thank you in advance for your help.

[Moe]

Hello there. You asked for a harship letter and you shall receive!

Many people get bad deals when they try to get a loan modification or a forebearance agreement. They are usually so unrealistic that it just delays the pain. That's why it's good to have someone, a non-profit, attorney etc, review your paperwork and make sure it's a good deal.

Your debt income ratios need to be high. They need to show that if they don't fix your loan then you would default. You shouldn't have a lot of equity either. If you do, they will suggest you sell. Which makes no sense because real estate isn't selling. You need to show Chase that you cannot afford the current payment and if they modify it then you can afford the new mortgage. They keep the figure secret and there is really no rhyme or reason sometimes so I couldn't tell you an exact figure.

I hope this helps and best of luck to you!

(Example Harship Letter)

To Whom It May Concern:

I am writing this letter to explain my unfortunate set of circumstances that have caused us to become delinquent on our mortgage. We have done everything in our power to make ends meet but unfortunately we have fallen short and would like you to consider working with us to modify our loan. Our number one goal is to keep our home and we would really appreciate the opportunity to do that.

The main reason that caused us to be late is (insert reason here and don’t be too lengthy and long winded) Soon after being late and our income not being nearly enough, we had fallen further and further behind. Now, it’s to the point where we cannot afford to pay what is owed to (lender). It is our full intention to pay what we owe. But at this time we have exhausted all of our income and resources so we are turning to you for help.

Our situation has got better because (reason here) and we feel that a loan modification would benefit us both. We would appreciate if you can work with us to lower or delinquent amount owed and or payment so we can keep our home and also afford to make amends with your firm.

We truly hope that you will consider working with us and we are anxious to get this settled so we all can move on.

Sincerely and Respectfully,

Mr. & Mrs. ___________________
Signature_____________________
Loan # ______________________
Address______________________
Phone________________________

[pbbobkanobi]

Hello all. I just joined this forum a few minutes ago and already have got tons of good info. Thanks Moe! You are a hero.

I contacted Countrywide yesterday to try and start the loan modification process. My 3/27 ARM just adjusted this month and my payment went up $610. they pre-qualified me over the phone for the process and told me to fax them a letter explaining my situation and proff of income. Here is a copy of the letter I sent them. Hopefully it will do some good. I will keep you all posted. They told me i should have an answer within 7-10 business days....we shall see.

**********************************

September 7, 2007
To: Countrywide Mortgage account # 058989482

Re: Mortgage modification program

Due to the recent adjustment to the mortgage I currently have with your company, I am finding it very difficult to afford the new payment. I have a 3 year fixed rate which is now adjustable and is schedule to adjust again in Feb. 2008. Considering my current income, there will be no way I can afford the increased payments come February. Hopefully there is way to renegotiate the terms of my current mortgage to avoid default or foreclosure on my home.
Is it possible to have my current adjustable rate mortgage converted to a fixed rate? If this is not possible can the next rate change be postponed to a future date to allow me to hopefully refinance. Any other solutions you could provide would be greatly appreciated.
I have had no problem making my payments for over three years now and do not want that to change. My mortgage was originally written by another company and bought by Countrywide. The original mortgage terms are terrible but it was the only loan I was qualified for at the time. I was assured that refinancing would be no problem but that turned out not to be true due to the downturn of the housing industry.
The main problem is that my property is now worth about 5-10% less than what I paid for it which is preventing me from being able to refinance. I was researching on the internet and came across the Fannie Mae Announcement #06-18 (Oct. 4th 2006) regarding the servicing of Conventional Mortgage Modifications. I believe this addresses the situation I currently find myself in along with many other homeowners.
Attached are recent pay stubs showing my current income. thanks you for your time and consideration.

******************************

Feel free to use any of this letter if you need to.

[Moe]

Awesome! That's exactly what I would like people to do. Let's pay it forward and hep each other through this tough time. Great letter. There is no perfect hardship letter, but people can use these and mix and match, plus throw their own spin on the letters.

What number did you call for the Countrywide Hope Department? Or were the calling it the Countrywide Home Retention Department?

Thanks for posting your harship letter!

[pbbobkanobi]

I just called the 877-744-7691 number but then you have to push 777777777 when it asks for your account number. This way it doesn't take you straight to customer service, instead you can get an operator. Then ask for the workout dept. That is the fastest way to get there without a direct number.
I called them to see yesterday if they recievd the fax but they said that it takes 3 days to get in the system. When I called the day before they said it only takes 24 hours. I hope this isn't a sign of bad things to come.

[Moe]

Thanks for the phone tips. Very helpful. As far as time frames go with Countrywide. All I can say is be patient and don't get too frustrated because what they say and what they do are 2 different things. However, it really depends on who is handling your case. Someone good and compassionate, then you're in luck. Someone non-caring and rude, then you're in for a lot of frustration.

Just write down names and employee numbers of everyone you speak with. That way if you have a problem, you can go to management. Document everything that is said to the T and remember they record all phone calls. What you say can and will be used against you.

[Mariel]

Thank you so much for the examples of what should be included in the hardship letters. I will send the letter and income info to Chase on Monday. I have faith in God - Chase WILL modify this loan, so that we can afford to stay in our home. I'll keep you guys posted.
Thank you again for your help and all the great info on this forum.

[Moe]

Your very welcome and faith is sometimes what we need to lean on, to make it through these tough times. A little faith goes a long way. I wish you the best and please let me know if I can do anything to help.

[pbbobkanobi]

I called Countrywide today to make sure they recieved my hardship letter and finacial info. I was told they did get it and I was in the review process which usually takes 3-4 days according to the girl on the phone. Their website says it takes 2-3 weeks which sounds more realistic. The original guy I spoke with last week said I should have the loan modification papers to sign before my next payment is due. That's if I'm approved. I am crossing my fingers and hopefing for the best but the waiting is killing me. It feels like I am waiting for test results for brain cancer or something. It is good to know that at least I am in the system. My chances of approval seem to be good since I owe more than the house is worth and the only reason I wont be able to make my payments in the future is the interest rate increase. Wish me luck.

[Moe]

I wish you good luck and please keep us posted

[tonib13]

I am calling Guaranty Bank who as my first loan and CountryWide Home Loans who has my second tomorrow, to ask where to fax my hardship letter. I am nervous and no that it is going to be a long process, but it is better then losing my home. We were put into a lousy loan and now that the market has dropped and our adjustable loan has gone up, we are paying our mortgage late, but all other bills have not been paid, our credit is gone. any advise would be appreciated. thank you.