Originally Posted by eileenbunny

That isn't really true. The real answer is that MOST of your money goes toward interest instead of principal for much of the loan. In the case of the OP, things won't actually tip into his favor until month # 255 I believe. Every month it gets a little bit better. An amortization table will give you the breakdown.

What I'm curious about is how the OP owes more than the original loan amount and how the property has wound up being worth so much less than what he paid for it. I'm not even sure that refinancing is an option here. I'd say that the only option would be to rent out the current one and purchase another property.

As someone else here pointed out, borrowing against a 401K is never a great idea. It's a terrible risk and a waste of money.

Also, you never know what you might need good credit for. Sometimes you need it to get a job, sometimes you need it to purchase something in an emergency. If your credit is good, try to keep it that way. Perhaps you could wait out this slump in the housing market. Things will get better. Sorry you are having such a rough time. Good luck to you.