A short sale, when the house will sell for less than what is still owed, is an extreme solution to get out from your mortgage debt. To get the lender to consider this option, you will have to demonstrate true hardship with a well-written hardship letter.
Below are two sample hardship letters for a short sale:
IMPORTANT: DO NOT COPY THIS LETTER EXACTLY. PLEASE USE YOUR OWN WORDS.
=========================================
[Date]
[Mortgage Company]
Attn.: [Point of Contact]
[Company Address]
RE: Hardship Letter – Short Sale for [Your Property Address]
Dear [Mr./Ms. Point of Contact]:
[Use a personal greeting if you have the name of a specific agent at your lender]
This letter is to provide you the details surrounding my current financial situation and reasons for requesting approval of a short sale at [your property address].
[Explain your financial hardship here. Skip the sad details unless they’re financially relevant. For example, you might say: “I was injured on the job in December 2013, and I am only receiving 30% of my pay while on disability.” You don’t need to go into how much pain you’re in, the injury, or how stressed you are about paying your bills. Simply stick to the facts as they’re relevant to your financial status.]
Due to [your hardship], I am unable to continue making my mortgage payments. I am also behind on my other bills and overall unable to meet my financial obligations at this time. To avoid foreclosure, I would like to request that you approve a short sale on my home.
I currently have an offer of [amount] for my house. Although it is below the current mortgage balance of [your current mortgage balance], it is the best offer I can get on my home. Please consider accepting this short sale as payment of my mortgage, in lieu of processing a foreclosure or allowing my financial status decline to the point that I must file bankruptcy. [Note: If you don’t yet have an offer but are considering working with a real estate agent who specializes in short sales, provide this information and details. Or, if you’re requesting to be entered into a short sale program or inquiring whether your lender is willing to permit a short sale, provide these details.]
I am enclosing a copy of my financial records for the past three months, which documents my current financial status and my inability to meet my financial obligations. [Include bank statements, last year’s tax returns, last two pay stubs or unemployment documentation, and any late notices you’ve received on other bills.]
Please contact me at [Your Phone Number] if you need any additional information to process my short sale request. I am more than willing to provide any information you require to expedite this process, and hopefully resolve this financial situation without resorting to foreclosure or bankruptcy.
Thank you for your consideration.
Sincerely,
[Your Signature]
[Your Name, Address and Phone Number]
[Your Account Number]
———————————-
And here’s another example …
———————————-
{Your Name}
{Your Address}
{Your Phone Number}
{Date}
RE: short sale request for my home at {address}
To Whom It May Concern:
My name is {Name}, and I currently reside at {address}, a house that I bought
on {date of purchase}. At the time, {mortgage company} provided me with a
{30-year, 15-year, etc.} mortgage of {amount in dollars}, with a
{fixed/variable} interest rate.
When I purchased the home, I was perfectly capable of making the mortgage
payments on time and in full. Since {date}, however, I have been struggling to
make the payments because of {details of why you have fallen behind on
payments; be specific}.
Currently, my monthly income is {amount in dollars}, which must go to
{medical payments, childcare costs, etc.}, leaving an amount that will not
satisfy my mortgage payment.
I have found a buyer who will purchase my home for {amount in dollars}, which
is the best offer I have found since putting the home on the market in {month}. I
am hoping you will accept this offer so that we can both avoid the hassle and
cost of a foreclosure.
I would also appreciate it if we could work out a plan that doesn’t require you to
make a negative report on my credit.
I have enclosed the relevant financial paperwork that will help to illustrate my
current situation, including {explanation of the paperwork you’re including}.
I am truly sorry that I have ended up in this situation, and I hope that my plan for
this short sale will make it so that we can all move on as quickly and smoothly as
possible.
Sincerely,
{Sender Name}
———————————-