When getting a loan to buy real estate people would want to avoid one thing alone which is foreclosure. This happens when people are not able to meet the usual monthly dues to pay off their loans.
When property is foreclosed then, it has to go through legal requirements before being sold. If the borrower is under non-recourse mortgages, then the lender would not be able to get outstanding debt in case the sale of the house is not enough to pay for the loan. In other cases though, the mortgage is under deficiency judgment, then the borrower is still responsible to settle the whole debt if the amount of the real estate is not enough to suffice.
