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That’s not true at all. If you buy the house for 100k and sell it for 200k, you walk away with 120k after paying off your mortgage. If you only owned 20%, then
by rp1 5y ago
That’s not true at all. If you buy the house for 100k and sell it for 200k, you walk away with 120k after paying off your mortgage. If you only owned 20%, then you would walk away with 40k. Similarly, in non-recourse states (which is most states) you are on the hook for the mortgage amount if the value of the house goes down.
- telotortium 5y agoYou meant to say "recourse" states - non-recourse means that the bank can't pursue you for any remaining amount you owe on the house after they foreclose on the house. Non-recourse is not very common, but California is a non-recourse state, for example.
- rp1 5y agoThanks!
- ModernMech 5y agoOk I see what you are saying.