Only the purchase mortgage in non-recourse. If you refinance, you are screwed. So HELOCs and refis are not protected under this law. Also, you will capital gains taxes on the unpaid balance.

Worst of all, what can you do when you’re penniless and evicted from your home?

To rent our house, we needed $4500 cash for deposit + 1st months rent, plus $1200 or so for movers (credit card was okay). How likely is someone, freshly evicted or in foreclosure, to have $4500 laying around, and some credit for moving expenses? If they had that much money, wouldn’t they have used it for the mortgage? I think people will spend their retirement money before they let their house go back to the bank.

What are the options for people in foreclosure? They’ll probably leave San Diego to rent in a cheaper area. Moving and renting costs money. Where from? Most likely scenarious is that these folks will move back home with mom and dad, or siblings, or other family. With no money and shot credit, what else could you do?