Filing for bankruptcy [View all]

My ex and her husband bought a home in 2006 on an ARM (adjustable rate mortgage). Not too bright. Here's the thing...they took out against the house to the hilt. Remodel, exotic vacations, car, etc...

It all fell apart after the crash in 2008 when the ARM started to balloon and the home's value took a big drop.

They declared bankruptcy and got their debt wiped out.
My question is...how was this debt absorbed? Through raised interest for the rest of us? By the lender? U.S. taxpayers? Combination?

I ask this because they are so damn quick to bash Obama as a "socialist" among other nonsensical rants against the "government" and I am looking for knowledge of just how big of hypocrites they are in getting their debt erased.

P.s...I just learned they bought another house. That was quick. I had know idea you could buy another place after only three or four years away from a bankruptcy.