It seems that this sort of risk is something that the Banks offering and the people taking should bear the burden of. I don't know the details of that type of loan, but basically if the market goes to pot, there is going to be more people declaring bankruptcy, if they can. I certainly hope the cost associated with the risks of these loans are built into the cost of the loan....but I highly doubt. It just sounds like a way for banks and real estate people to make money while others take the risk, if the cost isn't built in.