There may also tax implications(with both a Foreclosure and a Short Sale) that you will need to discuss with a CPA.
There are so many things involved with a foreclosure. I would suggest you talking with a Realtor that deals with Short Sales in your area. They will know the benefit between going with a Short Sale vs a Foreclosure. And there are some benefits to going Short Sale than Foreclosure.
A Real Estate lawyer would be a great person to ask how long a bank has to come to you for the deficiency. The banks do have time lines that they have to follow.