I think one question needs to be asked first. Do you have equity in the property? You may not even know the answer to this, but an agent can help answer this.
If you do, you want to capture this equity. I hear you saying that you no longer want to try to keep the house.
If you don't have equity, I don't know that a short sale would benefit you over a foreclosure. If the property forecloses, you would have a high probability of being offered financial relocation assistance after the fact.... more
They still have a lien on the home...the only reason the second would go to the expense is if they thought they could recover more money on the deal. In this case, there is either equity or perceived equity by the second.... more