Not bad?

But surely he would still owe the bank any money that they lost on the deal.
To take some example figures: Say he bought the house for $800k, using $200k cash and a $600k loan.
Suppose that at the time of stopping the payments, $100k had been paid off, so the amount owed was down to $500k.
Some of the $64k in "saved" payments would have, if he had he made them, reduced the debt even further, but the interest element (say £50k) would simply have been added to the debt, raising it to $550k.
By the time the bank sold the house, they could only get $400k for it. Now who lost what? The bank didn't really lose the $150k shortfall; he still owes them this, unless he filed for bankruptcy. He also lost his initial $200k and has nowhere to live, and a blemished credit record. That seems to me to be a pretty unenviable position to be in.
Yes, probably, but I can accept "on mortgage" as a variant of "on tick" or "on credit".