If you cannot afford to pay the mortgage anymore, Instead of walking away from your house, this is what you can do:
Contact your lender immediately to see if you are qualify for a loan modification. Explain to your lender that you can no longer afford the mortgage payment due to your current situation (sickness, lost of job or income, divorce...) to see what the lender can do to help you stay at your home. If you owe more than the house's worth, ask for lender's loss mitigation department will help speed up the process.
To help homeowners keep their houses, lenders can lower your principle and/or lower your interest rate through loan modification. By doing so, it will lower your mortgage payment tremendously provided that you have enough income to pay for the reduced payment.
Here's a real story about one of my coworker's client. Her client loss 50% of his income because his full time job was reduced to part time. After working with the lender on loan modification for 6 months, his mortgage payment was reduced from approximately $3000 to $1000 per month by lower the interest rate from about 6% to 2%.
If for any reason your lender can not help you with loan modification, contact a local Realtor who is experienced in working with distress owners immediately and put your house on the market for sale. If you owe more than your home's worth, you will need find a short sale specialist. An agent with experience in rental properties will be a plus to assist you in finding a suitable rental if you are credit challenged.
I am a license Realtor/Broker who have experience working with distressed owners, short sales and rentals. If you are looking for a qualified agent who can get your house sold quickly and help you transition into a nice rental smoothly, please contact me immediately for a free consultation.