Actually, it’s exactly how it works. Bankers yell about the potential for homeowners to do “strategic defaults”, to stop paying mortgages because they are underwater.
Of course, this is exactly what businesses do. In fact, Jon Stewart’s Daily Show did a hilarious piece on the Mortgage Bankers Association. It started with clips of the MBA president attacking the immorality of strategic defaults. Then it uncovered that the MBA itself had strategically defaulted on its mortgage on the building it owned.
Bankruptcy judges can routinely alter the principal owed on second homes or yachts, but not on your first home, the primary form of wealth that average people have. This is a rather gross class inequity that further points out the injustice of not doing mortgage for ordinary people.