In order for your lender to determine what foreclosure-alternative options are available in your case, you will need to provide documentation.
While your lender may have additional requirements, begin by gathering the following documents:
- Any correspondence your lender has sent you regarding the delinquency status of your file. Be sure to look for a specific contact name, department, or telephone number.
- Your most recent mortgage statement.
- Pay stubs covering the most recent 30 days of employment for all persons occupying the property. If you are self-employed or have a side business, also create a year-to-date profit-and-loss statement for the business.
- Complete personal tax returns (all schedules) for the past two years.
- All W-2 forms for the past two years.
- Bank statements (all pages for all accounts, including checking, savings, money market, etc.) covering the past two months.
- All of your monthly bills, including credit cards, auto loans, utilities, and so on.
In addition to collecting the items listed above, write a hardship letter. A hardship letter provides a detailed explanation of what event or events caused you to fall behind in your mortgage payments.
In writing this letter, it is important to be specific about your situation.
You will also need to specify the status of the hardship. For example, you might explain that you lost your job and were out of work for six months, but are now back to work.
For most modifications to be successful, the event that caused you to fall behind in your payments must be over.
Proceed to Step Three