Paying Late On A Stay & Pay

[OpAck]

Hi everyone...I've been a casual observer of these forums for quite some time now, and it has been of TREMENDOUS help for me and my family! My wife and I filed for Chap 7 in November 2009, so we're now entering our 3rd year post-BK.

We smartly chose to not re-affirm the mortgage, and instead opted to do a Stay & Pay with Wells Fargo. We've been on time with our payments ever since.

However, this month really put us back in a hole...with Christmas, a car that needed about $500 in repairs, what may become about $600 in root canal surgery and a few other expenses that popped up. Now the mortgage is due, and it'll put us in a bit of trouble until we both get paid.

Does anyone know what we can expect from WF if we're say, 2-3 weeks late with one mortgage payment? I thought NC was a state where the bank is required to get the foreclosure ball rolling swiftly...which is something we would not want. And when the bank has said that "You can continue staying in the house as long as you pay on time", it kinda makes us a bit nervous. The legalities of this Stay & Pay thing is sometimes confusing. It was completely foreign to me when we first filed, but this forum certainly has helped.

[AngelinaCatHub]

When you 'stay and pay' and cannot pay, your original mortgage rules apply. Usually there is a 30 day grace period before they would act. I would call your loan officer and tell them you will be late this one time. By rights, they could escalate your mortgage as usually mentioned in the small print. They don't want your house though, they want the money. Letting them know will put a notation on your profile that acct receivable will probably accept. The courtesy of informing them first may go a long way. 'Hub

Relax a bit, you'll get by.

[OpAck]

When you 'stay and pay' and cannot pay, your original mortgage rules apply. Usually there is a 30 day grace period before they would act. I would call your loan officer and tell them you will be late this one time. By rights, they could escalate your mortgage as usually mentioned in the small print. They don't want your house though, they want the money. Letting them know will put a notation on your profile that acct receivable will probably accept. The courtesy of informing them first may go a long way. 'Hub

Relax a bit, you'll get by.

Thanks! Much appreciated.

Yeah, I thought about calling and I'll do that. I guess, the toughest thing is understanding the relationship between bank and customer, after the customer had included the mortgage in Chap 7 BK. It almost feels like they're doing us a favor by letting us stay here as long as they keep getting their money. But you're right, they certainly would rather have my money at some point, rather than start the foreclosure process.

Update: We decided to make that notation in our account and pay at least half the mortgage for the month now. That should give them enough reason to believe we're still in the house and we still intend on staying and paying.

[AngelinaCatHub]

Thanks! Much appreciated.

Yeah, I thought about calling and I'll do that. I guess, the toughest thing is understanding the relationship between bank and customer, after the customer had included the mortgage in Chap 7 BK. It almost feels like they're doing us a favor by letting us stay here as long as they keep getting their money. But you're right, they certainly would rather have my money at some point, rather than start the foreclosure process.

Update: We decided to make that notation in our account and pay at least half the mortgage for the month now. That should give them enough reason to believe we're still in the house and we still intend on staying and paying.

Good for you. However, I hope you did explain the situation as a half payment at times is considered no payment. Let the service person upgrade your computer profile non-the-less. GBWY 'Hub

EDIT: I see you did mention this in your post. Must be age. Wish all well with you now. Sleep easy.

[justbroke]

I don't think you'll have many problems. I don't want to give you a lecture, but this is really for others who read this. You really really need an emergency fund. One month's expenses is not enough. You should have 2-6 months worth -- I prefer six. I only have about 2 month's worth right now, but working towards 6 myself. It is too easy to start robbing Peter to pay Paul; a condition which ended in bankruptcy for the most of us.

I'm happy to read that you paid half and noted your account. Just make sure you don't go 31-days past due. That's usually the first trigger. Besides, going 31-days past due usually requires you to pay the past due payment PLUS the next payment. This is where many get into real trouble. As 'Hub noted, the half-payment will probably go into a "suspense" account and only be applied when the other half is received.

Best of luck to you.