Extreme Hardship Letter

Through an extreme hardship letter, you can communicate your problems to your creditor and explain the reasons behind your failure of meeting the monthly payments. If your case is genuine and you are not hiding the facts, you can get your loans rescheduled and in some cases, the loan can be written off as well.

In the first paragraph, explain how you took the loan and your past relationship with the creditor. Be apologetic for your failure of making the monthly payments in recent months. Then next step is to explain the reasons behind your hardship and attach the necessary documents like proof of your income, late notices, bank statements, medical bills and tax forms.

Close the letter with a promise that you will make your efforts to pay the bills on time in future, followed by your signature and name.

Instructions

  • 1

    Sample of an extreme hardship letter

    January 18, 2011
    Bank of America
    Main Boulevard, New York, 55500
    Dear Sir/Madam,

    I took a personal loan of $15000 from Bank of America two years ago and have been paying my monthly payments on time. However, I have not been able to make my monthly payments since the last three months and have been getting notices from the bank. I am writing this letter to explain my unfortunate scenario.

    I faced a severe road accident about four months ago and was hospitalized for a month. Meanwhile, I lost my job and currently do not have any source of income, which has led to my inability to pay my monthly dues. I get an unemployment check from the government, which is hardly enough for me to meet my medical expenses and food.

    My right leg is still not working properly and the doctors have advised me to take rest for another six months, which means that I will not be able to pay my monthly payments to Bank of America in near future.

    I request my bank to write off my debt. I know it is going to damage my credit history but I am not left with any option at the present moment.

    With the letter, I have attached a proof of my Income, late notices, bank statements, medical bills and tax forms. Kindly let me know if you have any questions.

    Sincerely,

    James Goodwill
    P.O Box 33300
    Phone # xxx-xx-xxxx

  • 2

    Template of an extreme hardship letter

    (Date)
    (Creditor)
    (Address)

    To whom it may concern,

    I regret to inform you that I am unable to pay my monthly payments because ---------------. Due to my present scenario, I will not be able to make my monthly payments in the near future as well, which is the reason why I request my load to be written off/modified.

    With the letter, I have attached a proof of my Income, late notices, bank statements, medical bills and tax forms.

    Please feel free to contact me if you need any further information.

    Sincerely,

    (Name)
    (Address)
    Phone # xxx-xx-xxxx

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