eli5 What would happen if I pull the equity from my home with a cash out refi and then le the home go into foreclosure?

Question

Im aware that my credit is gonna take a big hit but I want to know what’ll happen to me down the road.

In: Other

Answer 1

You are likely not going to be able to get a line of credit greater than your available equity. Available equity = value of house minus remaining loan.

So if you go into foreclosure the sale of the house will cover the loan and the line of credit.