How to Write an Extreme Hardship Letter

Job loss is a common reason to write an extreme hardship letter.

An extreme hardship letter is a form of business letter meant to demonstrate that the writer is facing a genuine and difficult-to-surmount obstacle that is preventing him from fulfilling a debt or paying a bill. Though writing an extreme hardship letter may require a lot of humility, it may also deter collection agencies and creditors from pursuing debt collection activities. In addition, appealing to creditors in writing may allow a person to have his debt consolidated or reduced.

Instructions

1. Write your name, address and telephone number at the top of your letter. Alternatively, write the letter on your personal letterhead if you have is available.

2. Skip a line, and then write the name of the bank, hospital, insurance company or other recipient. Follow this with the institution's address, telephone number, and "ATTN: Ms. Contact Person."

3. Skip a line, and write the date.

4. Skip a line, and write "RE: [Insert consolidation or restructuring] of debt on [Insert account type: Mortgage, credit card, loan, or other name]"

5. Skip a line, and write "To Whom it May Concern:" or "Dear Contact Person:"

6. Write a simple, short paragraph declaring the purpose of the letter, for example: "I am writing because I am experiencing extreme financial hardship and would like to find a way to reduce/restructure my payments."

7. Skip a line and write another paragraph that expands on the reasons for your financial hardship. Include a specific date that your troubles began, and as much detail as possible. Include your approximate income per month, and a general idea of your other financial responsibilities.

8. Skip a line and write a third paragraph that assures the recipient of your humility, and that you have no intention of avoiding your responsibilities. Offer a solution -- a reduced monthly rate, a reduction of debt altogether, a postponement of payment. Assure the reader that you wish to avoid collection agencies, foreclosure, or other collection actions by any means possible -- and you would like to work with them to make it happen. Ask the reader to contact you to discuss the options as soon as possible.

9. Close with a businesslike sendoff, such as "Sincerely," or "Yours Truly." If you are typing the letter, leave five spaces under the sendoff and then type your name. Print the letter and sign in between the sendoff and your name. If not, simply sign and then print your name.

Tips & Warnings

• Like any business letter, an extreme hardship letter should be typed. However, very neat handwriting is acceptable.

References

• Letter of Hardship: Letter of Hardship
• Letter of Hardship: Possible Recipients