Financial Hardship Letter Template

Financial Hardship Letter Template

What Is a Financial Hardship Letter?

A Financial Hardship Letter is a written statement prepared by an individual with existing financial obligations and sent to a lender in order to postpone the payment, explain the reasons behind the default, and work together to solve the issue regarding the debt. Download a printable Financial Hardship Letter template through the link below.

Do not ignore your lender, loan provider, or financial institution - you should contact them and ask them to lower the amount of debt or cancel the penalty you have to pay in addition to the principal sum owed. You should offer a solution to the payment default in your Letter of Financial Hardship and promise to stay in touch to avoid a negative entry in your credit report.


How to Write a Financial Hardship Letter?

Follow these steps to compose a Letter of Financial Hardship:

  1. Greet the recipient of the letter - you can address the employee of the bank if you have communicated in the past and you know this is the person who will review your documentation and make a decision regarding your financial situation.
  2. Introduce yourself, refer to the loan or agreement you have entered into in the past to identify your account, and state the reason for writing the letter.
  3. Explain why you cannot make payments or handle interest anymore, or why you will not be able to keep up with the loan schedule in the future weeks or months. You must convince the lender your financial position is really poor and there is no way you can carry the duties implied by your initial arrangement.
  4. Add more weight to your statements by sending supplemental documentation that proves your difficult financial standing and shows that you cannot find money at this moment. For instance, medical records and a statement from your physician can be attached to the Financial Hardship Letter for medical bills. When you draft a Financial Hardship Letter for school, you may provide tax returns of your parents, guardians, or other people who bear financial responsibility for your education.
  5. Do not be vague - you must describe the situation clearly and honestly. Your position and the proposed plan have to be straightforward and clear. Do not let your emotions get the best of you - only present facts that can be proven by the documentation you attach to the letter.
  6. Add your contact details and offer the recipient of the letter to stay in touch if they need more information from you. Sign the document and send it via certified mail to obtain a receipt or simply use email.

Related Letter Tags and Templates:

Download Financial Hardship Letter Template

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