Should I be worried about recourse loans if I have PMI?

[Samuel S.]

Hey BP Folks,

So I am just trying to understand why I've seen so much debate on why some people would rather get a non recourse loan vs a recourse loan...Especially when non-RC are worse terms, higher rates/fees etc..

At the end of the day, I could have a recourse loan but never be liable for a deficit as long as I have PMI, right? Because if I foreclose, the insurance will just kick in for the deficit, regardless of the state?

On the other hand if I DO NOT have PMI but have 20% equity built in, and end up getting foreclosed on, the chances are very slim that there will still be a deficit remaining after the foreclosure sale?

If the above instances are true, then is there really that much risk in having millions+ dollars of investment debt?  Any advise would be greatly appreciated!