Can someone explain "stay and pay" option for house in Ohio?

[kellysmum]

Our attorney has explained to us that since we have nowhere near the necessary monthly income to pay our mortgage (1046.00), the bankruptcy judge will not let us reaffirm the house. We are also underwater on the house (owe 108.000 and house worth 80,000 or even less). We don't want to move b/c we can find nowhere that will take our three dogs (in a rental) that is also in our school district (our daughter has a scholarship to a private school she loves because we live in such a lousy school district). Plus, we tried looking for a rental and it turns out that there isn't one that will take us and the dogs for less than we're paying on the mortgage.

Our attorney has advised us that since we want to stay, but will not be able to reaffirm the mortgage, we should "stay and pay." He said the mortgage would disappear off paper, would go off my husband's credit record, and we would no longer receive statements from Wells Fargo. We understand that we are basically "renting" from the mortgage company without the benefits. We still have to pay the property tax and insurance. My husband is upset because we have lived in the house eight years and will lose all the money we put into the house in payments, plus we will have to give up any equity and will have no right to sell the house, even if we pay off the mortgage in the end. Are we understanding the law correctly?

[LadyInTheRed]

No, you aren't understanding it. You will eventually build equity as you make payments (or if the value of the home increases). You will still own the house and be able to sell it, assuming you can sell it for enough to pay off the mortgage. If you keep making payments until the mortgage is paid off, you will own the house outright. But, if you decide at any time in the future that you can't afford to make payments, you can live in the home for free until the bank forecloses and then walk away without any liability to pay a deficiency.

The only things that will change about the mortgage are that you won't be personally liable for a deficiency, it won't be reported on your credit reports and you may not get statements from Wells Fargo. But, they also may send informational statements, especially if you ask them to.

[mknolan]

I have a Wells Fargo mortgage, I will not be reaffirming and will "stay & pay". I continue to receive statements from them each month. I checked my credit report yesterday for the first time...it shows that Wells Fargo Mortgage was included in Bk but also notes that the account was "never late". I have heard nothing from them as far as reaffirm. I only reaffirmed my auto loan with Chase, they sent me the paperwork just before my 341.

[DaisysMom]

I'm in Ohio, mortgage is with Ocwen (formerly GMAC). I am "stay and pay" since my BK in early 2012. Nothing has changed, I even still get my monthly email reminding me that my payment is due. I haven't checked my credit report. I'm glad I didn't reaffirm.

DM

[TRfromillino]

I have a mortgage from a local bank, did not reaffirm, and will stay and pay. I have not recieved a statement since I filed, but anticipating it, I stapled the last one I got from them and keep track from there. Since I haven't been discharged yet, they may still be observing the 'stay'. I believe they will allow me to pay and stay simply because they'd rather have it paid monthly than go thru the expense and trouble of foreclosing. They are still reporting to the credit bureau tho.

DaisysMom, I'd be checking the credit report, even if for no other reason than to get any inaccuracies off of there.