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In this tutorial, the speaker discusses the importance of a hardship letter when applying for a loan modification, repayment plan, short sale, or deed in lieu. For a loan modification, the letter should convey that, despite previous financial hardships, the applicant has since recovered and is in a stable financial position. Conversely, if seeking to exit debt through a short sale or deed in lieu, the letter should emphasize ongoing financial struggles and the unaffordability of mortgage payments. Understanding the purpose of the hardship letter is crucial to effectively communicating one's situation to the lender.