Every lender has different requirements when it comes to a short sale. What I would suggest is that, if you feel you need to conduct a short sale, you contact your lender and describe your situation to them. If you are experiencing financial hardship, explain that to them. Let them know your whole story. Get their advice on what you should and should not do in order to have a short sale. Also, I would enlist the help of a local Realtor specializing in short sales and foreclosures. You are going to want to have someone on your side that has dealt with this kind of sale before, because they can be tricky. I would suggest never going late on any payments, but again, ask your lender. Going late on a payment may just in fact be a requirement of theirs in order to conduct a short sale and if that is the case, and there are no other options for you, then that is what you should do. As I have stated, I would suggest you hire a local Realtor that has the experience to deal with these sales. It can mean a world of difference. Good luck.