But what if instead of losing value, my house had increased to $500k. If I walked away then, the bank would be getting title to a $500k property on only a $360k loan. The bank would be making a tidy profit. Would walking away be “immoral” in that instance? Would the bank be acting immorally by taking the property?
[/quote]
The bank would not be making “a tidy profit.” It would have to pay you the difference between the net received on the property (after all expenses) and the price for which it was sold. The situation you describe would never occur.
