You've gotten good advise here but you really need to sit down with a Real Estate Attorney that handles short sales. It is one thing to tell you do a short sale and another thing to do the work for it only because you don't like the house. As Dan said you have to take into consideration what will happen to your credit and is it worth it.
Do NOT walk away from your home... it will give you a very bad credit score that will prevent you from buying another home for 5-7 years and could also prevent you from getting other loans (car, TV, furnature, etc...)
I'd recommend that you talk to a Realtor to determine if you are a candidate for a "Short Sale"... if you can prove a financial hardship your bank will accept, then that would be your best course of action to achieve your goals.
The only other thing I advise you to do is to find the company that: (1) does the most home transactions in your Linden, MI area and that (2) has a seperate department that just specializes in helping people avoid foreclosure (might be your case). Talk to an agent from that company that is Certified to handle "Distressed Properties".
Contact me... I be glad to help...!
Certified Distressed Property Expert
Short Sale & Foreclosure Resource
Brighton, MI 48114
You've found out a house is harder to get rid of than a girlfriend. Before you jump to do a short sale or foreclosure, please consider the medium and long term consequences on your credit and future purchases. Both will impact your credit for years to come. This means limited access to not just future mortgages but auto loans and other credit too. Rates will be higher and you will need more down just to qualify for major purchases in the future.
You may be better off making some changes to the house to make it more to your liking until the market comes back or consider renting it out. Chances are if you stick it out for a couple years something will give. You will like the house better, the value may come back or you may find a good tenant and your credit will remain intact for your next purchases. Best of luck.
You sound like a perfect candidate for a Short Sale. Don't waste to much time and my advice is to try a Short Sale before you walk away. You have exactly until the end of this year until the Debt foregiveness act expires. Read about it here;
A short sale will be easier on you financially and especially mentally, than any other option. I know it sounds scary, but we make it simple and we will guide you through the whole process. I can go on and on, but just come in for a no obligation consultation, you will be impressed. (I don't want to sound like a commercial but it sounds like you want someone to help you.)
Call, text or email me and we can go from there. We are the #1 Short Sale company in Michigan, we have the system that will help you. I can email you information if you don't want to come in, just let me know.