Under President Obama's new "Making Home Affordable" plan, you may be eligible to short sale your home.
A short sale helps you avoid foreclosure, by getting the bank to take less money than is owed on your home.
To do a short sale, call the bank, or banks, that hold your mortgage(s) and ask them if you are eligible to do a short sale. It will take some time, and you will get transferred several times before getting the people you need, but eventually you'll get the short sale department. To do this you will need the bank's phone number, your loan number and your social security number. They will also ask you for your phone numbers and home address to verify you are the homeowner.
Here's the government web-site on the program:
After indicating to them that you are interested in a short sale, they will take some information from you and usually send you a "short sale package." A "short sale package" is a packet of papers you need to fill out about your financial situation. It will ask you a series of questions and you will need to send in the following documents with it:
1. The last 2 years of tax returns.
2. Your last 6 paychecks.
3. Three months of checking and savings statements.
4. A detailed account of any other assets you have except retirement funds.
5. A family budget, including all expenses and incoming money monthly.
6. A hardship letter-a letter telling the bank(s) what led to your current financial position and why they should help you.
It's a good idea to have this stuff ready as they often don't give you much time to gather it.
At this point, if you haven't already done so, call a real estate agent who is experienced in short sales and get your home listed. Please keep in mind, you may still need to do some prep work on your home to assure a sale, but it's well worth it considering you are avoiding a foreclosure on your credit reports!