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I don't see why they can't declare bankruptcy. (Although I don't know how much has changed with the new rules.) They can let the bank foreclose on the property and then declare BK after the bank comes after them for the remainder OR they can just go ahead and declare BK ahead of time and save the foreclosure hassle. (With bankruptcy, you usually aren't allowed to have more than X in equity in your home, which wouldn't be the case in this situation.)

If they are unemployed with no real property, what else are they but bankrupt. After BK, they can get an almost normal loan rate after 2 years (it will stay on credit for longer but banks like 2 years to pass.)

Despite all we hear on the news, the middle/working class are the true victims. The welfare class will continue as usual and the rich can afford to get on with life.

No. You are incorrect. The new Bankruptcy Act changed everything. People cannot just walk away from their debts and hurricane wrecked houses. Not today. Thank Congress. Both parties joined in the fun. Do not blame Bush, because it's not his fault. But the Democrats will point their fingers at Bush anyway.

I don't see why they can't declare bankruptcy. (Although I don't know how much has changed with the new rules.) They can let the bank foreclose on the property and then declare BK after the bank comes after them for the remainder OR they can just go ahead and declare BK ahead of time and save the foreclosure hassle. (With bankruptcy, you usually aren't allowed to have more than X in equity in your home, which wouldn't be the case in this situation.)

Doesn't the new federal bankruptcy law change all that?