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> my house won’t be worth the debt I took on. Don't you mean your house won't be worth the equity you put in? Assuming you put 20% down, your debt is 80%. I wo
by stanleydrew 8y ago
> my house won’t be worth the debt I took on.
Don't you mean your house won't be worth the equity you put in? Assuming you put 20% down, your debt is 80%. I would think it's pretty tough for a house to lose more than 20% of it's value.
Also, if the house isn't worth the debt you took on, that's technically the debt holder's problem not yours.
- buzzdenver 8y agoI'm not the GP, but I'm guessing he means what he said. Being "under water" means that the debt is more than the house's value. So ignoring the various costs of bankruptcy, it would be better to just walk away and lose the current equity, then buy the same house at current market price.
- rahimnathwani 8y ago"it's pretty tough for a house to lose more than 20% of it's value" Yes, June 2006 to April 2009 was pretty tough on the US housing market! "if the house isn't worth the debt you took on, that's technically the debt holder's problem not yours" Right, unless you care about having zero net worth and/or not having a roof over your head.