There are many reasons that prospective short sale sellers need to participate in a short sale. Most of these reasons are caused by some sort of hardship. And, most all short sale lenders, these days, will require a documented hardship letter to be included as part of the short sale package. The most common hardships that appear on hardship letters are:

1. job loss,
2. relocation,
3. decrease in the work hours or family income,
4. excessive credit,
5. loan interest rate adjustment,
6. divorce,
7. medical,
8. death,
9. incarceration.

While there may be other reasons that people need to sell in a short sale, the list above reflects the most common hardships.

I’ve seen a lot of hardship letters and spoken with a lot of short sale negotiators and the best advice that I can give is to write a letter that contains the following:

Write about what circumstance has changed since the home was purchased, and explains the reason that you (or your client) cannot continue to make payments on your home any longer.

The best stories are short and to the point and can be done in five sentences or less. And, since employees in loss mitigation departments across the nation are so busy, I would bet that your five-sentence hardship letter will get a better read than your two-page letter.

If you or your clients have a bit of writer’s block, here’s a simple quick start hardship letter. (For each number below, write one sentence)…

To Whom It May Concern:

State loan number and property address.

Explain personal and/or financial situation in year of purchase or year mortgage loan was obtained.

Explain what has changed in your personal and/or financial situation since you purchased the home, and explain why you need to sell the home right now.

Mention that the home is now worth less than the loan amount owed.

Request consideration for the short sale.

Sincerely,

Borrowers’ Names / Signatures