When you are dealing with a foreclosure situation, a mortgage "workout" resolution will allow you to resume your mortgage payments and arrangements are made to pay the past due amount over a period of time.
The successful workout will depend on you presenting a convincing argument to the mortgage company/lender that you did suffer a financial hardship, but at the same time you will have to demonstrate that you are capable of making regular payments in the future.
The mortgage company/lender will require 4 things to process the workout: A Hardship Letter You are required to write a letter describing the hardship that caused your loan to go into default, and communicate the solution you would prefer to bring your loan current.
The hardship should always be involuntary, such as medical reasons, job lay-off, divorce, or a death for example.
In this letter you include your proposal for the workout and your explanation as to why you are sure your plan will succeed.
Paystubs Two paystubs are required from each person living on the premises, who are contributing to the household expenses.
The lender takes this into consideration in determining what your capabilities are as far as making your future mortgage payments.
Tax Returns The homeowner will be required to provide the previous year's tax return.
If you are self- employed, the tax returns for the prior two years will be required to determine the income levels of your business.
Financial Statement The financial statement is a statement that summarizes all of your assets, income, and liabilities.
This is another tool for the mortgage company/lender to determine whether the economic hardship can be resolved.
When you are dealing with a financial situation like this one, you should always submit your paperwork in a package, and always, always, keep copies of everything you submit for your own protection.