I basically owe more on my house than I can sell it for. I can no longer afford to live in it. How can I get out without ruining my credit?
Getting out with credit intact is not easy! Unfortunately, this is becoming a common question.
The reality is that even if you have great credit, and didn't lie about your income to get a loan, and stayed away from teaser rates, etc...in other words, you did it right....you may have done it at one of the worst possible times. For the longest time, homes only seemed to go up in value and seemed like a sure investment, even for the short term. But, alas, investing in anything carries a risk and people are now finding out that these risks sometimes bring a lot of pain when the market goes against you.
Well, on to possible "solutions" for your trouble.
One thing you may be able to do, depending on just how bad off you are, would be to rent your home, even at a loss and let a tenant pay down your debt until you can sell. This solution may require you to subsidize your mortgage payment from your own savings, but will not affect your good credit rating and may well buy you some time.
You may be able to obtain a loan modification. Lower interest rate or extending the term may be something available. Contact your lender for help.
Sell Sell Sell your home. Continue to try to aggressively market it, offer a higher than normal commission to the selling agent, hook up with a local mortgage rep who can help you offer a reduced rate at your own cost, if possible to make it more attractive to a potential buyer.
Whatever you decide to do, if you are at risk of default, talk to your servicer and keep them informed. This is the best way to get help from the lender.