system
Given the following post, respond as if you're commenting on Reddit:
human
eli5 What does it mean to be "upside down" on your home loan and how does it happen?
gpt
Imagine you buy a house for $100.  You pay $20 up front and take a mortgage out for the other $80... so you still owe $80.

After a few years you've paid down another $5, so you still owe $75, but in that time the housing market took a hit in your area and your house is only worth $70 now (nobody would buy it for more than $70).  Since you owe MORE than its actually worth... you're considered upside down on the loan.