Chase Home Finance requires "proof of hardship" letters from customers seeking help with their mortgage payments because of financial problems. Some people are unable to pay their mortgage and are at risk of foreclosure due to reasons including illness, divorce or unemployment. The hardship letter is an explanation of the problem backed by proof, such as a job layoff notice, divorce papers or medical bills. Chase uses the letter to help determine if the homeowner is eligible for loan modification.
Details
People writing a hardship letter to Chase should include detailed information in the letter about their income, assets and debts. The disclosure should list complete information on the debtor's household budget, including all recurring obligations. Examples of recurring obligations are mortgage payments, car insurance, day care costs, utilities and groceries. A listing of all monthly credit obligations is also necessary, including installment loans, student loans and car payments. The debtor should also list all regular income sources, including the net received each paycheck by each borrower listed on the Chase loan. The debtor should list all assets, including money available in retirement accounts and ownership of other real estate, such as rental property. Chase will use the information to determine if the homeowner merits special consideration because of excessive debt or other hardship.
Foreclosure Avoidance
Chase Home Finance is one of more than 100 mortgage companies participating in the federal government's Make Home Affordable program as of 2011. The program encourages mortgage companies to help people avoid foreclosure by modifying the terms of their loans to make the payments affordable. Lenders call the process loan modification because it allows them to change any or all terms of the loan, including the interest rate. The first step in loan modification is contacting the lender. As of 2011, the MakeHomeAffordable.gov website lists 866-989-1356 as the contact number for loan modification requests at Chase Home Finance.
Incentives
Make Home Affordable is a $75 billion program created to address a rise in missed mortgage payments, defaults and foreclosures in the United States caused in part by high unemployment and a drop in home values. The program remains active as of May 2011. Mortgage companies such as Chase receive payments from the government for each mortgage they modify to help homeowners avoid foreclosure.
No Guarantees
Chase Home Finance and other lenders make individual decisions about loan modification based on proof of hardship letters and other information. In 2010 Pro Publica reported that Chase rejected an application from one woman after deciding that her hardship was "not of a permanent nature," according to documents secured by the news organization. In December 2010, the U.S. Treasury Department issued new guidelines for mortgage companies participating in the Make Home Affordable Program. The updated guidelines "explicitly prohibited" mortgage companies from distinguishing "between short-term and long-term hardships," according to Pro Publica.
Counseling
People who want help writing a proof of hardship letter to Chase can contact a government-approved credit counselor. Counselors certified by the U.S. Department of Housing and Urban Development are available in most communities. The counselors can review the borrower's situation and offer advice on what to say in the letter. Counselors can also discuss how loan modification works. Initial conversations with the housing counselors are free. If necessary, the counselors can contact Chase Home Finance or other lenders directly to discuss loan modification. People can find counselors in their area by seeking referrals from local charitable organizations such as the United Way or Salvation Army.
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