My wife’s sister and her husband live in the bay area as well. She is a veteran and served 27 years in the air force. But before she retired she said a cardboard box hit her in the head and that she has neck pain. So in addition to her pension she gets disability payments from the military and disability from Social Security. Her husband is still active working as a colonel. They pull in around $200,000 a year.
So they bought a new house 15 years ago using her VA benefits and then they kept borrowing against it until just 5 years later they owed twice what they paid. Her husband was transferred to a different base, but the market correction caused their house value to drop back to what they paid for it so they were underwater.
They found another brand new house using his VA benefits in a better neighborhood and closer to his new base. Their previous house was sold on a short sale after about the same time they moved into the new house. They of course bought all new furniture when they moved... to match the new house. They also both drive nearly new luxury cars and he has two vintage corvettes.
The bank took the loss and if you recall there was some type of legislation that has run out now, where they didn’t have to pay income tax on the hundreds of thousands of dollars they took out on all of the refi’s and never had to pay back.
The thing that amazes me is that her sister still pretends like she went through real hard times on this.
Oh I forgot to mention... they did sell their bass boat and motorhome... so I guess some sacrifices were made.