Did you know?????
Generally speaking: a short sale on your property will ding your credit by about 100 points and a foreclosure will ding your credit by about 200 points. If you can make a short sale work, get a qualified real estate agent involved and work it to help save some points for your credit. Even an attempt at a short sale (selling the property at a lower price than is owed on the loan, with your lender's approval) may help show some efforts in your favor.
But don't wait....as soon as you think there might be a problem, call your lender and see if there can be a "workout" on your loan. They may be able to get you in to a better loan, reduce payments, refinance, tack missed payments on the end of the loan etc. you don't know until you ask, and it's more likely to happen if you talk to them BEFORE you miss a payment.