What happens after you walk away from the house depends on the mortgage company.
As Anna says below, this would be a good time to talk to an attorney. In fact, you probably should be taking to several people, including a lawyer, the mortgage company itself, an organization that offers foreclosure counseling in your part of Arizona, and a real estate professional. If you handle your situation poorly, it can haunt you for a long time. See the CNN/Money article link in the "Web Reference" section below.
Talk to the bank because banks occasionally will let you turn in the keys and walk. The lender probably also has some kind of loan modification program. Though these programs usually involve a lot of jumping through hoops, they can be worth the effort if they help you stay in your home with affordable payments.
Organizations that provide foreclosure counseling can give you a good idea about all your options. City and county governments often have recommendations about good local counseling organizations. However, stay away from individuals and companies that promise the world. If it sounds too good to be true, it probably is.
A real estate agent can help you with information about short sales â€“â€“ a way to sell your house for less than the bank is owed. Sometimes this is a better way to go.
This is a good time to educate yourself before you make a move that could haunt you for a long time. There usually are good options, but you have to find the best one for you.
Prudential Real Estate of the Rockies