Interesting comentary on this situation
<a href="http://finance.yahoo.com/expert/article/moneyhappy/164722">What Not to Do When You Buy a Home</a>
In a 'New York Times' story headlined ?My Personal Credit Crisis?, economics reporter Edmund Andrews, 48, lays bare his finances and admits to a headlong dive into the subprime debacle. In the piece, excerpted from a forthcoming book, he describes buying a home he couldn?t afford with his second wife, Patty, falling ever deeper in debt, and cashing out his equity to finance a lifestyle that cost $3,000 a month more than they were earning. It ends with Andrews defaulting on the mortgage and, eight months later, still waiting for the bank to begin foreclosure proceedings.
Andrews? story is riddled with classic personal-finance errors thought to be the province of the uneducated, underemployed, and ill-fated. Andrews was none of these; he earned $120,000 a year and didn?t suffer a disability or job loss. He explains his folly this way: "The money was there, and I was in love?I just thought I could beat the odds." But -- at least in hindsight -- the colossal improbability of beating the odds leaps off the written page. This is magical thinking at its finest, from a guy whose job is to write about the facts all day long. Multiplied by tens of millions of homeowners, it brought the U.S. economy to its knees.