[kabar]

Not true. Regardless of the home's value, if you make your monthly mortgage payment there is no foreclosure.

Not true? There have been plenty of reported cases that it is a fact. And even the banks are walking away from foreclosed properties,

If I purchase a home for $500,000 and take out a $400,000 mortgage and the value of the property declines to $200,000, I would seriously consider walking away from it. It would be difficult to sell and I would have to make up the $200,000 to pay off the mortgage if I sold it for $200,000. It is the reason why the Adminsitration has established a program to address this issue: Obama Mortgage Assistance Plan

[oh8eleven]

If I purchase a home for $500,000 and take out a $400,000 mortgage and the value of the property declines to $200,000
Doesn't matter. You live in a house worth whatever the market will bear - $200K, $100K, etc., and you continue to make your monthly payment. Month after month, year after year, the value of the house may change (up or down), but you keep paying and there is no foreclosure.
However, if you decide to stop making payments (for whatever reason), then yes, you'll end up in foreclosure.