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Financial Hardship Letters – Samples

A financial hardship letter is written by an individual to request temporary relief from an obligation due to extreme financial circumstances. Commonly used after a job loss, illness, death, or other unforeseen event, this letter explains to a lender why the individual can no longer make regular payments on a mortgage, loan, rent, or any other bill.
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Updated January 24, 2025

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How to Write a Financial Hardship Letter (5 steps)

1. State the Purpose of Your Letter

Begin your letter by stating exactly what you are requesting from the recipient and why. Be sure to specify the type of relief that you are seeking, and that you are committed to meeting your obligations in the future.

2. Explain the Hardship You are Facing

Describe the circumstances that are causing your financial hardship. For example, if you are unable to work due to a severe injury, describe the nature of your injury, how long it will take for you to recover, and how your injury prevents you from working.

3. Describe the Financial Impact of this Hardship

Provide specific details regarding how your income, assets, or expenses have been directly impacted by the unforeseen hardship. For example, describe how much income you have lost by not being able to work, or how much your medical bills are.

4. Propose a Specific Alternative Payment Plan

Put forward a specific and time-limited modified payment plan that will allow you to recover from the financial hardship you are currently facing. This could be an extension on the date a bill is due, reduced monthly payments, or a waiver on certain fees.

5. Provide Evidence

Attach supporting documentation to your letter to strengthen your case for why you need relief from your obligations. Such evidence may include hospital bills, paystubs, bank statements, or a letter from the employer.

Sample

Janet Franklin
500 W Arlington Ave, Apt 701
Chicago, IL 60614
jfrankli@yahoo.com
(212) 804-1692

Jan. 22, 2024

Bank of America
100 N Michigan Ave, Suite 1000
Chicago, IL 60601

Re: Loan Modification for Janet Franklin

To Whom It May Concern:

I am writing this letter to request a modification of the mortgage for the property located at 500 W Arlington Ave, Apt 701, Chicago, IL, 60614. Although the unfortunate events described in this letter mean that I am unable to make the $2,000 monthly payment under the current terms of the mortgage, I am committed to staying at the property, and I believe that the modifications I suggest will provide the help I need to return to the terms of the agreement.

I am seeking assistance because I lost my job as a middle school teacher due to budget cuts across the school district last year. When I was initially approved for this loan in 2021, my gross monthly income was roughly $4,000. However, since losing my job, I have been living off of my savings and unemployment benefits, which collectively provide me with less than $1,800 each month. As evidence of my circumstances, I have attached my employment termination notice and recent bank statements to this letter.

Until I am able to secure a new teaching position in another school district, I propose the following modification: starting next month, instead of my normal mortgage payment of $2,000, I would make payments of $1,000 each month for the next 12 months. This would allow me enough time to find a new job and get my finances back in order. After this period of time, I would make up the amount owed by making larger monthly payments of $2,340 over the following three years.

Thank you for your time and consideration. Please feel free to contact me anytime.

Sincerely,

Janet Franklin

[Signature]