Tips on How to Write a Home Loan Hardship Letter

You are struggling with your home loan payments and you have decided to ask your loan provider for a mortgage modification to reduce the terms of your loan. In such case, you should approach the home loan company asking for their cooperation by presenting an outline of your reasons for such request. A home loan hardship letter elaborates your present financial situation.

Here are some helpful tips on how to write a home loan hardship letter:

1. Contact the mortgage company and as for the home loan modification department. Request for the name, contact information, and address of the manager assigned to your mortgage. Make sure the spelling is right. At the top of your home loan hardship letter, include your contact information as well as your loan number.

2. Write in a formal style and express what you are requesting for, whether it is interest rate or a reduction in your loan balance. Provide a history or record of your on-time payments prior to your financial difficulties at present. Let the manager know that you really want to keep the property and you’re willing to make sacrifices for it. Request for a short-sale approval and provide explanation as to why such is better for you, as well as for the loan provider, as it could avoid very pricey foreclosure.

3. Describe your circumstances which resulted in late payments: you lost a source of income, you lost your stable job, or your ARM or Adjustable Rate Mortgage has risen beyond your capacity to pay. Explain how your savings are drained, maybe because you’ve become a victim of a swindler financial company, your pension was gone, or your investment plan has gone wrong.

Provide your employment history which shows that you have worked hard and that your present situation are not ordinary as your credit history proves your diligence before your financial struggles.

4. Outline the special situations which require that you stay in your current house: an elderly parent resides nearly who needs your regular care, or a special or disabled son or daughter attends a local school which caters to his or her special needs.

5. Explain your plan on how you can recover from your financial hardship: you are looking for a second job, or close relatives are willing to assist with expenses.

6. Try not to be exaggerated in expressing your current despair and worries, but make sure you let your lender know that you are presently in a very difficult situation and are doing everything to overcome it.

Tips on Getting the Best Deals on Home Loans

Nowadays people take loans for various purposes. However, the major reason for taking a loan has always been for purchasing a house. Home loans are in great demand especially due to the ever increasing real estate rates. People always try to look out for the best deals when it comes to taking home loans. This can ease their burden of paying the monthly installments. There are certain factors that need to be considered while applying for a house loan. The lender always requires certain documents before he can sanction your loan amount.

You need to provide all the documents in order to get your work done. The lender or financial institution also considers other factors before passing the loan amount. This includes reviewing your credit history, job and down payment amount. You should have a good credit history in order to get a good deal. It is better if the down payment amount is more as you will be able to get the loan faster. Another important factor is associated with your employment details. You should be working with the same employer or company from the past 2 years.

You can compare the rates of the lending institutions to know which deal will suit you the best. You can conduct an online research session and check the various websites to know about the best loan rates that are available. Do not forget to read the other information provided on the website before actually visiting the office. You might have to pay certain unexpected expenses in the process. Save a good amount of down payment so that you take a smaller loan amount and are able to repay it easily. Thus, this was some essential information on this topic and how to get the best deals.

Home Loan with Bad Credit

This is a fact: if you have a bad credit history, lenders would be indecisive whether to approve your loan application or not. Chances are your loan application will be disapproved. But you should not be disheartened. By following these useful tips you may still be able to own the house you have been dreaming for.

Assuming you have found the house you want to purchase… you have viewed the house and know the asking price. Most lenders would require a 10% down payment from people with bad credit history. You should be ready to pay for this. It would be even better if you can increase the down payment to 20% as this will give you more savings in the end.

It always pays to be ready ahead of time so before you submit your loan application, be sure to have all the financial information and all the other necessary documents needed in filing the home loan. A copy of the previous year’s IRS tax form will do as it will have your detailed financial information.

Shop for mortgage lenders. Because sub prime lenders generally deal with high risk loans from people with bad credit history, they charge unusually high interest rates, much higher than the interest rates charged by traditional lenders. To ensure against foreclosures, sub prime lenders require down payments. Although imposition of high interest rates seems to be the rule for sub prime lenders, you can still find some who do not charge exorbitant interest rates.

You can easily compare mortgage rates by logging in to mortgage loan websites. By entering your personal information and the loaned amount, you will be able to get quotes from several mortgage lenders. A difference of 5% in the interest rate will amount to thousands of dollars for the entire term of the loan. This big saving will be realized if you picked the lender with the most ideal quote.

Getting a home loan is not impossible if you have a bad credit history. It can be done. Just make sure that repayments are consistently done. This is one way by which you can rebuild your credit history. In no time you will have a high credit score and poor credit history will no longer be an obstruction in getting any kind of loan.