Leveraged purchases: why death pledge is bad

I started to write the following as a comment to housingbubblecasualty.com blog but I decided to blog about it, instead.

The problem in America today is that we've been conditioned to think that owning home = good citizen, renters = bad [fill in the blank].

After owning a home and losing $50K on it, I'm able to take a step back and be less jaded about owning another home again. Buying a home with a loan is like any leveraged purchase: you can make a lot of money if you profit, but you can also lose a lot of money if you have a loss. I've made some money and lost some using leverage (both with stocks and the 2 homes we've owned). Was it educational, yes. Would I do it again? The more I think about it, the less I'm likely to say yes.

To put it simply: for me, pure cash seems to be the right answer for even when buying a house. If paying cash for cars and day to day items are "a good thing" -- as people like Dave Ramsey would tout, why should we treat home purchases any differently? People don't go around saying you should max out your credit cards to buy stocks or maximize your margin account and buy as much as you can anymore (unlike the late 90's). So, why are we so conditioned to take exception to mortgage? In fact, we even have a different vocabulary just for home loans: mortgage (made from two words: death "mortuus" and pledge "gage").

Solomon gets it to the point:

The rich rule over the poor, and the borrower is servant to the lender. Prov 22:7

He didn't say "servant only for non-mortgage debt" nor "servant as long as it's not one of those 'good debt'" -- who are we kidding? Debt makes us obligated to pay back and the pressure is on day and night to pay it all back (and then some, since there's also interest to pay).