Late payments definitely hurt your credit score and account for a 1/3 of what makes up your credit score. The best thing you can do is contact your lender sooner rather then later so they can work with you. Many people wait and wait, not a good idea. A short sale has less of a negative effect on your credit then a foreclosure does but you have to prove a valid hardship. Typically condo dues that are in arrears are due at the closing so the bank would most likely have to pay if you don't have the money.
I hope this works out for you!
Accredited Buyer Representative
BenchMark Real estate
100 Congress St