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Comment by dennisgorelik | Hacker News Reader

You are in an unpleasant situation, but not in a tragedy by no means. To put things into perspective: imagine you have successful company but got pancreatic cancer.

Your to-do list is pretty straightforward:

1) Put your failed startup aside.

2) Find a job ASAP.

3) Try to save your house. Your family would need it. Beg your bank to give you ~extra month until your next paycheck.

4) In about a year you may return to thinking about another startup. Take another year or two to think it over, accumulate some funds, do some part-time research and then jump into your new startup again... or not. Being an employee until you retire is also a good choice.

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I disagree about the house. Lose it. Strategic foreclosure is 100x better than continuing to pay for something you're going to lose anyway. Ride it out as long as you can, save what you can from the mortgage payments, then move into a rental when it's time to go.

Just curious, because other comments also mention staying as long as you can and then getting a rental : wouldn't the first part mess up your credit record so badly that you couldn't get a rental? Here in South Africa I'm pretty sure almost no landlord will rent you something with a bad credit record like that (having gone through the process of renting a place and seeing all the proof they require that you'll be able to pay). Probably because it's very hard to get rid of tenants once they're in though, so you have to make sure they're ok before they move in. Is it different in the States?

Same thing with employing someone here, you have to be very sure they'll fit, because it's VERY hard to fire someone.

Foreclosure is so common that a decent landlord will understand the situation. I'm a landlord myself and income trumps credit in most situations.

Bad credit can be overcome with a bigger deposit, higher rate, and proof of income. In the end those things still mean more money in his pocket as opposed to spending a few extra months futily trying to save a home in foreclosure.

1) Generally rent is more expensive than owning the house of similar size (in SF and NYC it's probably not the case though).

2) Moving big family is stressful and time consuming.

3) Generally it's better for your karma if you pay your debts.

If the situation is desperate then foreclosure could make sense. But healthy software developer in the US is hardly in desperate situation even if his startup just failed.

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