pre-tax salary * 3 is the house you are afford. looks like you can afford 600k house with no difficulty.

pre-tax salary * 5 : 死撑

一个问题呀， 我自己没有答案。 如果买了一个房子， 600k, 5% down or 0 down, a year later, house price goes down 10%, ignore the principle paid this year, then you are owning the house upside down. what will you do? what if the house price goes down 20%? what will you do?

for the first situation, I will keep paying mortgage, 2nd situation, I am not sure...

that's an interesting thought. i would think bank all have to buy that kind of insurance themseleves. because under this kind of sicumstance, bank is under more risk than individual home owner.

it would be nice if this kind of insurance is available to home owners.

i think it is more risky to the bank. because home owners can choose to default the loan. why not? why paying something more than it's current market value? that's why i think banks must buy that kind of insurance.

of course, default load has serious concequences. but if you are facing something like 100k under the water, i think many will choose to default the loan.

oh. that's what the PMI is for!! thanks for your explaination.

I know bank will not take risks like that. so presumably bank does not think 20% correction happen often.

Again, business is protected while individual home owner is not. How can a home owner buy insurance like that?

I don't know the difference of the impact for the FUTURE between chapter 13 and 7, i.e. harder to get loan, mortgage, credit card, loss of some personal freedom etc.

not considering future impact, if I had to file BK, I will choose chapter 7. so when the good time is back, i have no burden to start.