How to: A Letter to the Bank for Negotiation of a Mortgage

Written by valencia higuera
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Many mortgage lenders will accept letters asking to negotiate a mortgage loan. Mortgage negotiations can help save your house from foreclosure. Typical negotiations may ask lenders to approve a short sale in which a house is sold for less than what is owed on the mortgage, modification to lower the interest rate without refinancing or a forbearance to take a mortgage break. Negotiation letters are also called hardship letters and winning your mortgage company's agreement can require some very convincing writing.

Skill level:


  1. 1

    Summarise your reason for writing the letter. Mortgage lenders have authority to negotiate various mortgage terms. Mention the type of help you need at the beginning of your letter. For example, do you need permission to sell your mortgaged house with a short sale, or do you need a loan modification to quickly lower your mortgage rate and avoid home foreclosure?

  2. 2

    Include information on personal finances. Banks only negotiate with borrowers who experience serious financial hardships. Highlight the severity of your economic circumstances by listing your present debts and monthly bills, and including information on how much you earn each month. Make copies of paycheck stubs, bills and bank statements as evidence of hardship. Attach copies with your letters.

  3. 3

    Give a reason for hardship. Mention any and all situations that created your present financial circumstances - job lay off, termination, sickness, divorce, death in the family or reduced work hours.

  4. 4

    Provide honest information. Don't exaggerate your hardship in hopes of getting a positive response from your bank. Lenders will verify your claims before negotiating your mortgage loan.

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