Van Zalingen said renting might be a smarter choice for some current homeowners.
“Foreclosure isn’t the end of the world. If your payment is unaffordable and your house is worth a lot less than what you owe the bank, consider renting an apartment for less and walking away. You can use that extra money to take care of your family instead of making your lender rich,” Van Zalingen said.
NHS guides homeowners, who do not qualify for the loan modification plan, to apply for forbearance (a reduction in payments for a few months) or a short sale, in which they sell the house for whatever they can get and the lender forgives the difference.
