Try Loan Modification First!

If you are a homeowner who wants to keep your home, but you are having a tough time making payments, a short sale may or may not be the best thing for you.  You should attempt to talk to your lender first and find out if they are willing to modify your payment for an extended period of time. Don't wait until you are 6 months behind on payments to do this.  By that time your best bet is probably going to be a short sale.  If you are going to attempt a loan modification ask a a local Realtor for a valuation of your home, preferably you want them to prepare a BPO for you.  The bank likes BPO's (Broker Price Opinions) because they know how to read them, unlike a CMA that may make no sense to your lender.  Keep in mind that the investors backing your loan prefer to work out an affordable payment with you.  They don't want to foreclose on you, but if you continue to give them no choice but to take action you may find yourself out on the street.  It's extremely important that you be proactive in these situations. If you know you are going to be unable to make your mortgage payment in the future then call your bank and ask for loss and mitigation now.