How do I write a hardship letter to the credit bureau?
Explain Your Hardship
Be honest with your creditor about the circ*mstances surrounding your hardship, but keep your explanation concise. Aim to keep your explanation under one page. While you should include relevant details such as what caused the hardship and when it started, don't include unnecessary information.
- The date, your name, address and phone number.
- The lender/servicer and loan number.
- The date or approximate time frame when the hardship started.
- The expected timeframe of hardship — short term (six months or less) or long term.
- Describe your goal. ...
- State the facts, not emotions.
Explain Your Hardship
Be honest with your creditor about the circ*mstances surrounding your hardship, but keep your explanation concise. Aim to keep your explanation under one page. While you should include relevant details such as what caused the hardship and when it started, don't include unnecessary information.
Because my income has dropped considerably I can no longer afford the terms of the original loan. As a loyal customer of your financial institution, I'd like to ask for the following: ▪ A lower interest rate amount of NO MORE THAN 6% ▪ Accept lower payments of $ _________ per month.
Explain how this situation has affected your finances, such as requiring you to use your credit card to pay medical expenses or leaving you unable to pay other bills. Include precise dollar amounts whenever possible as well as details of what you've done to try to keep up with your payments despite your hardship.
Examples of hardship in a Sentence
He had suffered through considerable hardship. The city has been experiencing a period of financial hardship.
When you write the hardship letter, don't include anything that would hurt your situation. Here are some examples of things you shouldn't say in the letter: Don't say that your situation is your lender's fault or that their employees are jerks. Don't state that things will likely turn around for you.
- Illness or injury.
- Change of employment status.
- Job Loss or loss of income.
- Natural disasters.
- Divorce.
- Death.
- Military deployment.
A hardship letter to a creditor lays out the financial circ*mstances that have made it challenging for you to continue making your monthly payments.
Hardship is a situation in which your life is difficult or unpleasant, often because you do not have enough money. [...] See full entry for 'hardship' Collins COBUILD Advanced Learner's Dictionary. Copyright © HarperCollins Publishers.
What do I say to creditors if I can't pay?
Explain your current situation. Tell them your family income is reduced and you are not able to keep up with your payments. Frankly discuss your future income prospects so you and your creditors can figure out solutions to the problem.
Unfortunately, my circ*mstances are unlikely to improve in the foreseeable future and I have no assets to sell to help clear my debt. I am therefore asking you to consider writing off my debt as I can see no way of ever repaying it. If you are unable to agree to this, please explain your reasons.
A hardship program may offer any combination of the following temporary measures to make your credit card debt payments more manageable: Due date extensions. Lowered interest rate charges. Pauses in payments and/or interest charges. Reduced minimum payments.
Also called economic burden, economic hardship, financial burden, financial distress, financial stress, and financial toxicity.
Keep your hardship letter brief and to the point: four paragraphs is ideal, and no more than two pages. Be sure to include: Homeowner name(s), address(s), and phone number(s) and relevant loan number(s). Relevant details about the loan or property, such as the number of months delinquent, property value, or equity.
Your repayment history remains available for two years, while hardship information is removed after one year. This means that, one year on, it will no longer be possible to tell from your credit report that you were in a financial hardship arrangement.
- Include Accurate Contact Information. ...
- Be Personal, But Keep It Semi-Formal. ...
- Keep The Letter Short And Concise. ...
- State The Problem. ...
- Provide Enough Documentation. ...
- Include An Action Plan. ...
- Have Your Letter Reviewed Before Sending.
Unexpected medical expenses or treatments that are not covered by insurance. Costs related to the purchase or repair of a home, or eviction prevention. Tuition, educational fees and related expenses. Burial or funeral expenses.
People experience all kinds of adversity in life. There are personal experiences, such as illness, loss of a loved one, abuse, bullying, job loss, and financial instability. There is the shared reality of tragic events in the news, such as terrorist attacks, mass shootings, and natural disasters.
A hardship letter explains to a lender the circ*mstances that have made you unable to keep up with your debt payments. The letter provides specific details such as the date the hardship began, the cause and how long you expect it to continue. Many creditors will require a hardship letter if you request help.
What is considered proof of hardship?
Natural disaster (i.e. fire, flood, or human-caused disaster). Unexpected increases in necessary expenses or decreases in household income due to divorce/separation; unexpected or sudden disability; or caring for an ill, disabled or aging family member.
Examples of situations that banks might consider as being hardships include: Loss of a job or a reduction in your income. Serious illness or physical injury that resulted in lost income or mounting medical bills. The company you work for is relocating and you will lose your job if you do not sell your home and move.
Don't Write a Novel
A novelist builds up suspense by hinting at what's coming up, but your hardship letter should be short and specific -- don't tease the loan modification staff who will be reading your letter along with many others.
They are the four sufferings of birth, aging, sickness, and death, plus the suffering of having to part from those whom one loves, the suffering of having to meet with those whom one hates, the suffering of being unable to obtain what one desires, and the suffering arising from the five components that constitute one's ...
causing very great pain, difficulty, worry, damage, etc.; ... See more at severe. hardship. noun [C or U] /ˈhɑːd.ʃɪp/us.
