Regardless of how you “feel” about the situation, the equity loans will be full recourse against the borrower. Many lenders will “get what they can” in a short sale, then pursue the seller for the deficency balance. Tactics include wage garnishments and leins against any assets they can find.
The “non-recourse” loans mentioned in an earlier post only apply when the loan proceeds are used to purchase or improve (renovation or additions) the property.
