Hardship letter- need advice

I am working on a ss for a couple but I am stuck on the hardship letter. Their situation is that they bought their home, had to move to texas to care for the wifes mother so in an urgent attempt to get rid of the property they found an investor who would take over the payments - however they did no paperwork to show this - no title work no purchase agreement -nothing - so the couple move to texas purchase a home their and the payments on the other home are being made for several months - then stop with no warning - so now the couple rent their tx home out to move back to attempt to sell the first home - won’t sell because there is no value and the market is aweful - so now they want to short sale it - they are going to lose their texas home as well because they can no longer afford either home - from what i gather the hardship is because of the two mortgages - one being they were under the impression it was taken care of - problem to me seems that the lender is not going to empathize with this situation - how do we write a hardship letter for this situation in order to push short sale approval - any suggestions?

In addition, this home is only 18 months new and repairs are very minimal - i’ve picked apart the place to find potential repairs but being that it is so new there isn’t anything major. All i could note is fresh paint, carpet cleaning and possible ceramic tile and grout repairs - whoopie right - need advice on this as well

I personally will NOT attempt a short sale on this one. Here is why:
The hardship you presented does not seem like a PERMANENT hardship, and in my opinion I would not mention the second part, the failed attemt to sell as “subject to” may hurt your case.
Having a second home may also be a negative. How is the mother now? If she has some kind of permanent disability I would hit on that, but it sounds “fishy” in my opinion. The letter has to be simple and to the point, have the seller hand write it. If you cant prove permanent hardship, you will waste your time.


Does the hardship letter play a role so significant that it can break the deal? I personally don’t think so. This situation sounds pretty permanent to me, and nonetheless, the house is still headed toward foreclosure and that’s all that the bank should be concerned with.

Why is the homeowner behind on BOTH mortgages though? Why don’t they continue to make payments on at least one of the houses, not both of them?

Maybe this isn’t a great SS potential b/c the house is so new. But if you can prove that there’s been a downturn in the market and the house won’t sell at it’s current price, then why wouldn’t the bank consider taking a small hit?

Your posting itself seems to include everything the hardship letter should contain. If you don’t wanna tell the bank that you tried to sell as a “subject-to”, then tell them that you tried renting the place out b/c you had to move to TX to take care of your wife’s mother, and then the tenant stopped making payments.

You might wanna get the house listed with a real estate agent while you do the short sale, this way the agent could put “present all offers” on the listing and you can present all reasonable offers to the bank as the current going rate for the house.

In short these homeowners made poor judgement and poor financial decisions imo. They left their primary home in the hands of an investor in order to move to texas with nothing to back it up. I didin’t believe them at first but I know the investor and did my research and they are not lying. When theyy left texas in early june - they rented the house out to a family member who decided to stop making the rent payments - thus falling behind on both homes - because they are 35k behind on both homes with legal fees and mortgage payments they just want out - the husband is the only one working - they have 4 kids and taking care of the mother - netting only 3k a month and all the responsibility is killing them - is this a sufficient hardship to be considered permanent - and maybe this is how i should explain it

This home is in buckeye, az - anyone familiar with this area will understand my issue :frowning: - new construction area very newly developed neighborhood about 40 miles west of phoenix - area has depreciated about 25-40k in the last 6 months -

p.s i have referred the home to my broker to handle the buyer side - we’re doing that next week :slight_smile:

Make the broker comp the property and submit that with the letter as well as with some bank statements that prove current hardship. If the bank feels that the couple has tried to remedy the situation (by renting out property or trying to sell) but cannot due to volatile market conditions, they may concede. I think it is worth a try. All the bank can do is say no.