Question Regarding Short Sale?

In Illinois, which is a recourse state, if you are approved for a second mortgage and go out and buy a home, then try to do a short sale on your existing home and are declined for your “hardship” then what happens? if you let your home go into foreclosure, does the bank come after you and your new home? i know someone who is doing this and it all just seems really dishonest to me. I would think if you were just approved for a new mortgage, the bank would come after you for trying to let your other home just go into forclosure. ??

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