This letter describes the specifics of the owner’s inability to cure the default and inability to sell the property at a price that will cover the default amount.
When it comes to the hardship letter, the sadder the letter, the better. The letter is a statement of facts describing how the seller got into a financial bind and pleads with the lender to accept less than the full payment amount of the debt owed.
Proving that the seller is experiencing extreme hardship and cannot make loan payments is the main focus of the letter. If conditions are that bad, it wouldn’t hurt to include bankruptcy in the plea.
The hardship letter should be honest. Most lenders don’t mind working with those who have experienced some level of misfortune, but they don’t want to deal with situations that involve dishonesty or fraud.