The most important document of the short sale package is the hardship letter. It is read by a real person (loss mitigator) that have emotions and cannot help be influenced by a sincere hardship story.
Please remember not to be embarrassed about your situation, create a compelling letter that is accurate, and also make your intentions clear. Use the hardship letter as evidence for the lender to accept your short sale, it can make or break your deal.
The physical letter is always better handwritten as long as it is legible. The top of the letter should have borrower name, date, lender and loan number. The length of the letter is not important, just as long as it has its desired impact. The letter should be blunt and honest and ask for forgiveness. This is not the place to complain, point fingers, or beg. It might start like this, “I regret having to write this letter, but unfortunately due to our financial hardship we are no longer able to pay on our mortgage. We ask that based on our current inability to make payments that you consider working with us to find a better solution with a short sale.”
The bulk of the letter is explaining to the lender why they cannot make their payments. Reasons to motivate the bank are, family death or illness, job loss or relocation, divorce, etc.
Finally, I will review the letter to make sure that details were not added that might hurt their case, or details omitted that would help