How To Write a Short Sale Hardship Letter

Hello, I'm Dana Ehrlich, Los Angeles real estate agent and short sale specialist.

One of the first things you'll want to do when we go to work on your short sale is to prepare a hardship letter.

The hardship letter has significant weight in the approval process and it can absolutely make or break a successful short sale.

Keep it brief, less than one page. Be direct and specific. Highlight your issues in bullet-points.
What's changed since you took out the mortgage. An example would be something like: there's been significant changes in my financial situation and I can no longer afford to stay in my home.
If your loan is a non-conventional type of loan - called a bad loan, explain this. Is it a negative amortization loan or an interest only loan where your payments have adjusted?
Talk about the Market and expenses: Say something about how the property is in an area where prices have declined by X% since you took out your mortgage. And/or talk about how your monthly expenses are too high for you to be able to pay your mortgage.
Explain your actual hardship: what's going on in your life that is causing you to no longer make your payments or cause you to be able to continue making your payments.
Reiterate that you cannot pay. You are a responsible person. You are looking for a responsible solution. Make a plea, something like: I truly appreciate your serious consideration to my serious matter. I do not want to face a foreclosure and know a short sale is the right thing to do.

Also, If you're considering a bankruptcy, let your lender know that in your letter.

While I can't write your hardship letter for you, once we start working together I'm here to help ensure what gets sent to the bank will do the trick.

You can contact Dana Ehrlich, Real Estate Agent & Short Sale Specialist at 310-487-0099 or [email protected]