"When push comes to shoving your loved ones out the door, Bob Hunt of Keller Williams O.C. Coastal Realty in San Clemente says the moral duty to protect your family outweighs the moral duty to repay the loan.Another interesting aspect that comes up is the opportunity to measure attachment, a loaded term in the Hindu tradition and one of the causes of human suffering in Buddhism (Wikipedia on Upadana):
'Promise keeping is not the highest moral value,' said Hunt, who before his real estate career taught ethics and logic at the University of Redlands. 'If I promised to lend you my gun and you are now in a clearly dangerous psychotic stage, breaking my promise would be the right thing to do, not the wrong thing.'"
There are some interesting variables. For example, although the biggest determinant is equity shortfall, another major consideration is people's attachment to their homes, with folks who bought more than five years ago far less likely to default.Interesting hat, thanks to the housing crisis, attachment and the suffering it causes can be so scientifically measured.