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you insured yourself against the risk of being priced out, but you now face another huge risk: If there is a big tech crash in the coming years, you might lose

you insured yourself against the risk of being priced out, but you now face another huge risk: If there is a big tech crash in the coming years, you might lose your job and still be liable on a Mortgage for a home that lost half of its value.

scarface74 8y ago
If the day comes where I can’t find any software development jobs - including contract work anywhere in my large metropolitan area (not Silicon Valley) and cant find remote work, I’ve got bigger issues. Major corporations that still needed development were still hiring here both in 2000 and during the recession. They could be a lot pickier between 2008-2011 and a lot were hiring contractors. My house (brand new build 2 years ago) has a mortgage that’s less than a quarter of my take home pay. I could get a job paying $30K less and still be okay - and my salary is just about the median for my skill level, nothing special.
gfodor 8y ago
Your post sure assumes a lot! It would be pretty foolish to take on a mortgage, in general, if a job loss could jeopardize making the monthly payments on time for any reasonable period. Being priced out doesn't necessarily mean "cannot afford" but can also mean "cannot justify paying."
wahern 8y ago
Home mortgages are usually nonrecourse loans. You can just walk away.
- dragonwriter 8y ago
  > Home mortgages are usually nonrecourse loans. In California this is true, plenty of other jurisdictions do allow collection of mortgage deficiencies. But, yeah, you can do that and pay taxes on the forgiven amount. Which, if you're walking away for financial hardship reasons is an extra kick in the teeth, but better than being saddled with the loan.
  - wahern 8y ago
    You don't pay any taxes because nothing is forgiven. You lose the house. The loan is secured by the home but nothing else, as opposed to being secured by the home and yourself as a guarantor. Non-recourse loans are the standard across the entire country. It has nothing to do with jurisdiction, at least not within the U.S. The people who get regular, recourse loans are speculators, people buying 2nd or 3rd homes, and commercial developers. This has to do with the terms of the mortgage contract, not with the law. Some states do have laws which regulate mortgage matters, but those typically only matter when there are problems with the contract, such as when people sell directly to each other (e.g. a prior owner holds the mortgage). The vast majority of people purchase homes through a bank, for which the standard terms are non-recourse.

scarface74 8y ago

If the day comes where I can’t find any software development jobs - including contract work anywhere in my large metropolitan area (not Silicon Valley) and cant find remote work, I’ve got bigger issues. Major corporations that still needed development were still hiring here both in 2000 and during the recession. They could be a lot pickier between 2008-2011 and a lot were hiring contractors. My house (brand new build 2 years ago) has a mortgage that’s less than a quarter of my take home pay. I could get a job paying $30K less and still be okay - and my salary is just about the median for my skill level, nothing special.

gfodor 8y ago

Your post sure assumes a lot! It would be pretty foolish to take on a mortgage, in general, if a job loss could jeopardize making the monthly payments on time for any reasonable period. Being priced out doesn't necessarily mean "cannot afford" but can also mean "cannot justify paying."

wahern 8y ago

Home mortgages are usually nonrecourse loans. You can just walk away.

dragonwriter 8y ago
> Home mortgages are usually nonrecourse loans. In California this is true, plenty of other jurisdictions do allow collection of mortgage deficiencies. But, yeah, you can do that and pay taxes on the forgiven amount. Which, if you're walking away for financial hardship reasons is an extra kick in the teeth, but better than being saddled with the loan.
- wahern 8y ago
  You don't pay any taxes because nothing is forgiven. You lose the house. The loan is secured by the home but nothing else, as opposed to being secured by the home and yourself as a guarantor. Non-recourse loans are the standard across the entire country. It has nothing to do with jurisdiction, at least not within the U.S. The people who get regular, recourse loans are speculators, people buying 2nd or 3rd homes, and commercial developers. This has to do with the terms of the mortgage contract, not with the law. Some states do have laws which regulate mortgage matters, but those typically only matter when there are problems with the contract, such as when people sell directly to each other (e.g. a prior owner holds the mortgage). The vast majority of people purchase homes through a bank, for which the standard terms are non-recourse.