How To Write A Short Sale Hardship Letter

The hardship letter is one of the key factors of getting approved for a Short Sale. If you can write an accurate hardship letter and obtain a market value offer The chances of getting approval improve greatly.

Goals:

• The goal is to write a brief, yet complete, request for a lshort sale. It should be one page with no more than 3 to 4 paragraphs.  They do not have time to read your life story.
• Explain why you can no longer afford your monthly house payment.
• Describe how you have tried to rectify the situation.
• Ask for help explain how you have no alternative but to seek a short sale to avoid foreclosure.

Steps:

1- In the first part of the Hardship letter, give your brief intro. Tell your lender who you are and apologize for defaulting on your obligation.

2-In the Second part, clearly explain which kind of hardship you are suffering from and what has led to the income loss. Whether you are suffering from job loss, divorce, death, business income loss or anything else. Very clearly and briefly explain your hardship. Also explain the measures you have taken to make rectify the situation (depleting your savings, borrow from family and friends, Etc.)

3-In the third or fourth if you are requesting a Short Sale ask for help. Advise that you have place the house on the market with a realtor and have no alternative but to seek a short sale to avoid foreclosure.

Columbia SC Homeowner's new rules let you get back into homeownership sooner after foreclosure -- in theory. But will lenders play nice?

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FHA and Fannie Mae are making it easier for Columbia SC homeowners who lost a home to foreclosure or short sale to buy again, but it might not make much difference if lenders don’t go along with the changes -- since they don’t have to.

First, here’s what’s new at FHA and Fannie:

FHA rules now let Columbia SC Homeowner's apply for an FHA mortgage 12 months after a foreclosure, short sale, or a deed-in-lieu of foreclosure if you meet two conditions:

1.  Your loss was caused by economic conditions beyond your control. (Job Loss, Death, Illness ETC).

2.  You complete housing counseling.

Note: Mortgage lenders have traditionally made Columbia SC homeowner's wait two years after a short sale or deed-in-lieu and seven years after a foreclosure to apply for a mortgage.

Once the Columbia SC homeowner has met the conditions, they will still have to meet all the usual mortgage loan rules and guidelines that lenders use for everyone -- like having enough income (and not too much debt) to afford the refinanced mortgage.

Fannie Mae credit reporting fix: Fannie, meanwhile, has cleared up a credit reporting issue that was holding back former Columbia SC homeowners who sold their homes for less than what they owed on the mortgage (a short sale) or signed over their deed to the lender to avoid foreclosure (a deed-in-lieu). Starting Nov. 16, 2013, the Fannie Mae loan underwriting system will automatically ignore the foreclosure and correctly recognize the transaction was a short sale when the code appears. Until then, Columbia SC  lender's will have to manually underwrite your loan to take advantage of the change.

As always Columbia SC homeowner's need to remember that, Fannie Mae and FHA can change their own rules, but lenders don’t have to go along with the changes because the mortgage giants’ rules are simply minimum standards. Our sources say it’s likely that lenders will add their own, more restrictive rules.

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