I am sorry for your loss and your hardship. Have you contacted the loan modification department because they may be willing if you can prove hardship to workout the loan terms for you.
With that being said, I'm a little confused as to your question. If you opt for losing the $60,000, are you still able to payoff the entire balance on your mortgage but you walk away with nothing (i.e, $0)or is the house worth $60,000 less than what you owe so the really the bank is losing the $60,000 and you are able to walk away through a short sale and protecting your credit from the impact of foreclosure?
The impact the foreclosure will have on your credit is not something to take lightly. If you decide that you do not want to still own the house due to your unfortunate circumstances, you and/or your agent should contact your lender and start the process of a short sale. Although each lender varies, the initial short sales packet usually consists of the same documents: a letter of hardship for you, a letter signed by you authorizing the bank to speak to your agent, paystubs, tax returns, bank statements. Your agent will have to provide a copy of the listing of the house, along with the comps and a detailed analysis of the current market where the property is listed as the bank is most likely out of state and only the realtor can provide a true analysis of the marked conditions. Some banks will actually give the "miracle number" or at least a price range in which they will entertain an offer while other banks just say to bring them an offer and then it'll be about 4-6 weeks before the bank responds to the offer. Have you looked to your agent for advice? Does your agent have experience in short sales and/or foreclosures? I've learned that when it comes to short sales...experience plays a key role.
Gina Chirico, Sales Associate
Prudential NJ Properties
973-239-7700 ext 132