Loan Hardship Letter

If you are facing financial difficulties and are unable to pay your debts, a loan hardship letter might be one of your last options to salvage the situation. There is nothing wrong with sharing your problems, especially if you have a good credit history and this is a one off instance.

Your aim is not only to convey that you are in financial trouble but also assure the lender that you intend to pay him back and make good on the loan. This might require you to share your intended future course of action as well.

Here we will show you how to write a loan hardship letter and will also provide a helpful sample and template for your reference.

Tips for Writing a Loan Hardship Letter

  • Get to the point and share why you are facing financial difficulties
  • Clarify how you intend to rectify the situation and make good on your debt
  • Assure the lender that you have a plan and need support to get through
  • Keep your tone positive throughout


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    Sample of a Loan Hardship Letter

    Alex Heal
    New York, 2211
    Highbrow Bank

    December 13, 2013,

    Dear Mr. Alex,

    It is with regret that I write to you to inform you of my financial hardships and consequent inability to pay back the installment on my $10,000 loan from Highbrow Bank.

    As you know from my previous record, I owe the bank a total of $7,300, which are due in 8 months from now. However, due to a lay off at my company, I am without work and will not be able to meet the timeline for my monthly installments.

    I am currently searching for new jobs, and am hopeful given my experience and resume. However, currently the market is saturated, and you would be aware how jobs are difficult to find.

    Despite my best efforts, if I am unable to secure employment within the next month, I would need like to request a loan modification with more flexible terms to accommodate my circumstances.

    Kindly get back to me and let me know my options. I am confident that you and the bank will be supportive through this rough patch.


    Wayne Rory

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    Template of a Loan Hardship Letter

    [Name of Recipient]

    [Today’s Date]

    Dear [Name of Recipient],

    As you are aware, I owe (you/your bank/bank name) (amount owed) which is due (due date for loan). However, due to uncontrollable circumstances, I am not in a position to pay my upcoming monthly installments for the loan.

    (Reason for financial difficulty – loss of job/divorce etc) has rendered me unable to meet my expenses, and I would like to request a flexible loan plan to make easy installments.

    In the meanwhile, I intend to (search for jobs etc) and am hopeful that it will work out soon.

    If you look at my previous record, I have been making timely payments and have no outstanding installments. I hope I can expect some flexibility during this tough time.


    [Your Name]

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