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If you want to have your lender work with you to stop house
foreclosure, the prognosis is good that you must supply them
with quite a bit of paperwork substantiation of financial
difficulties. Financial hardship necessities and
documentation is different from lender to lender but here
are some areas you need to be ready to supply them.
1. Information about what your expenses and what your income
currently is. Your lender cannot decide if they can help you
or not unless they have this information. They need to know
what your finances look like right now. This means that you
have to be truthful with them and more importantly with
yourself about what your financial problems are. Do not lie
to them about what is going on with you financially. If you
do, you may end up not qualifying for help. This is also a
great way to really figure out where your money is going.
Chances are good that you will need to figure out how to
spend less if you want to stop house foreclosure. This
exercise can help you figure out areas where you can do
this.
2. Paperwork substantiation of your present income. If you
are employed, you will have to provide them with pay stubs.
If you have money entering from other places, you must
supply substantiation of that too. If you are self-employed,
this can get more difficult. Having profit/loss statements
available for the past several months at least would be a
good idea.
3. Tax return information for several years. Be prepared to
provide your lender
needed tax returns for the three previous years. If you use
the 1040 form, give them all of the schedules (A, B, etc) in
addition to your basic 1040 form. It could save you a step later and
chances are that you already have that information filed
with your 1040 anyway so it would be easier to just give
them that information as well.
4. A letter that explains your hardship situation. This is
where you tell them why you are having financial problems.
This is your only chance to explain your case to the other
human being on the other end of the line who reads your
hardship letter. Tell them that you want to keep your home
and tell them what led to this point in your life. Who
knows, you may find a caring, compassionate human being to
read it and want to help you out. Many lenders will take a
divorce, employment loss or disability as a hardship
situation.
But one thing to keep in mind is that all lenders have
unique requisites for financial hardship cases and if you
want to stop house
foreclosure, you must receive the requisites from your
mortgage company.
A good tip: Fax or email every document that they need at
one time. They are busy and it is quite probable that your
paperwork could go missing or get mislaid if you fax or
email your documents in different batches to them. Also give
them your loan number every time on every piece of paperwork
that you send to them.
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