If you have tried a loan modification and a short sale but neither have gone through you still have options. Once your property has been on the market for some time (three to six months are required by most banks) this may be another thing you can do.
Deed-in-Lieu of Foreclosure This is when you sign the deed over to the bank that is holding the mortgage. They become the owners and it becomes their responsibility to secure it and put in on the market for sale. It seems like the easiest way to go but you have to do a lot to get to this point.
You walk away from the stress
Credit score drop can be smaller than a foreclosure
Banks are less open to this option
Again, there is a time frame involved before the banks will even consider this option. It saves them from having to do a costly foreclosure but banks don't like to own property. You have to be careful not to wait too long to ask for a deed-in-lieu, once foreclosure proceeding begin this may no longer be an option.