Ride Through questions

[Noangelmom]

What happens if we discharge the mortgages and use option#3 pay and stay - then a year later we sell the house... who gets the $$ from the sale of the home? Will that $$ go to the mortgage company toward the loan we no longer are liable for or do we pocket that money?

What effect does a ride through have on mortgage interest on 2010 taxes?

What are our options for purchasing a home in the future if we ride through, then end up foreclosing?

[pcn]

To expand on your questions, what if you stay 10 years (pick a number)and the equity increases substantially. I understand that some contracts define bankruptcy as one type of default. If so, can the bank then foreclose in time in the future at will? And who is entitled to the future equity? I think a "Ride Through Sticky" would be a great addition to the site. Anyone else think so?

[CCsAreEvil]

What happens if we discharge the mortgages and use option#3 pay and stay - then a year later we sell the house... who gets the $$ from the sale of the home? Will that $$ go to the mortgage company toward the loan we no longer are liable for or do we pocket that money?

Wow. I'd love to pocket that cash. But, no, you must satisfy any liens on the property. We just do not become legally liable to repay the loan. But the lien(s) survive the Ch 7 (assuming that's what you did). If you sell the property, all notes must be satisfied. I think if you sell it and make a profit (on top on what's owed on mortgages), you get to keep anything left after the escrow balance paid in full. But, what are the chances of that in this economy?

[Noangelmom]

Definitely, I second the motion for a sticky.. I have so many questions and thank you pcn for expanding on my questions... the answers will be a weight lifted. Thanks again.

[OhioFiler]

What happens if we discharge the mortgages and use option#3 pay and stay - then a year later we sell the house... who gets the $$ from the sale of the home? Will that $$ go to the mortgage company toward the loan we no longer are liable for or do we pocket that money?

What effect does a ride through have on mortgage interest on 2010 taxes?

What are our options for purchasing a home in the future if we ride through, then end up foreclosing?

You get the net proceeds of the sale after the mortgage holder's lien is satisfied.

If you continue to pay your mortgage after discharge you will continue to receive the mortgage interest deduction on your tax return.