I have a neighbor who is in foreclosure, yet he still goes to work every day. Why lose the house? All the money he put down, all the payments he made over the last 10 years, just gone.
I am seeing this with MANY listings I look at. House sold for 310K in 2006, someone put a lot of money down judging by the 223K foreclosure (doubt they would build up even half that much equity in that little time without a large down payment). These people are still employed by all appearances, and paid pretty well from what I can tell. Yet it is so common.
If you put no money down and the value dropped in half, I could see a reason. But when you have nearly 100K in equity, even in this market?