eli5 What does it mean to be “upside down” on your home loan and how does it happen?

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eli5 What does it mean to be “upside down” on your home loan and how does it happen?

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Anonymous 0 Comments

Owe more than it’s worth. I take out a $400k loan to buy a $500k house. The housing market collapses and now suddenly the house is worth $300k. I still owe $400k to the bank, but the house isn’t worth that much.

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