Before you can even qualify for a loan modification on your mortgage, you must be able to prove that you are facing financial hardship. Doing so requires writing a hardship letter, which states your reasons for financial difficulty while citing a plan that can work if granted the lender's help in lowering your payments. Only then will you gain your lender's empathy, thus allowing them to consider your case. Here are some tips on writing an effective hardship letter.

First of all, know that while you may apply for the help, not everyone qualifies. Unfortunately, you are given only one chance to submit your application, so you must use your time wisely and plan your actions ahead of time. Taking advantage of obtaining a mortgage loan modification might be your only option to avoid foreclosure. With this in mind, start your letter by explaining the reasons for your hardship are beyond your control, and that you are no longer able to afford your payment. Provide a brief, but clear description of the situation. Were your hours reduced at work? Did your company down-size? Were you or someone in your immediate family hospitalized for an extended period of time? Did you get a divorce? Did your suffer the loss of your spouse or a child? These are all common reasons for your lender to consider helping you. Indicate what happened, without being too wordy.

The next part of your letter is even more crucial to your success. This is where you cite your plan for improvement, letting the lender know how and why you will be able to afford a lower monthly mortgage payment, and still afford to live in your home. Banks are wary of granting help to homeowners who will then default in their loans again when their situation hasn't improved very much or they have failed to budget wisely. It is vital for you to assure the lender that your budget and altered mortgage payment will enable you to stay in your home.

Along with conveying your commitment to staying in your home, it is a good idea to add reasons behind wanting to be able to keep it. Your involvement in activities in your immediate community, including church, work, or school will stress your desire and your need for staying a resident in the area. This will also provide your lender with further empathy. You want them to make the connection between your life and theirs, so they can understand where you are coming from.

Those are just the basics when it comes to what makes the best hardship letter. Every homeowner is faced with his or her own combination of hardships and circumstances, but you will want to ensure yours stands out in order to be approved for a loan modification. Otherwise, you and your family might not receive the help you need before it's too late.