Hey Chuck and Lori, sorry again about your situation. Dealing with this .... is extremely stressful. I'd say the first step is to step back for a minute just to set aside a couple of hours in the next couple of days to spend some time together for dinner and agree in advance to not talk about anything related to the house, finances, work, etc. Then you really need to look at your finances and decide how long (given current income circumstances) you can sustain living in the house without using credit to stay there. Actually, I'd say immediately register with loansafe.org and copy and paste your original post there. I first posted my situation asking for help just under a year ago. The responses that I got said that I'm lucky to be in a non-recourse state and that I should walk away since I'm also 80/20. Basically, they said don't hold out for principal reduction, cash is king in the near to not-so-near future, so consider cutting away ASAP. I haven't yet, I stressed and obsessed for a couple of months and talked to a FHA underwriter who was pushing to get me into a pseudo short refi, but when I read the good faith estimate, it appeared that I would need to put down $10k to complete the transaction. I confronted him about that, and he said that no, that should be covered by the lender somehow. But as far as I could tell it was clear that I'd be paying. And everyone I asked on the forum said that I wouldn't get that deal anyways because no lenders right now are walking away from loans for small fees or doing any type of principal reductions. I had hassled the underwriter with every detailed question by this point and didn't get definitive answers to questions that I needed to know as fact; e.g. - I said that I needed to see written proof that doing a refi won't change my non-recourse status. He over and over again said that he knew that it wouldn't, but when it came down to it he could only quote an article from an attorney that he had met in AZ, but he couldn't produce the article. Those 2 things kept me from pursuing the refi with him at that time; I just couldn't wrap my head around the urgency of applying right away. I said that values are expected to drop at least 20% more before hitting rock bottom (and the already have), so why not wait until the bottom to do a short refi? He said, well lenders may not be willing to do a lower amount, because that would just be too much to loose. And I just didn't reply after that. Now, I've been fortunate enough to be able to afford staying in a holding pattern this past year. I just decided that since I was able to do so, it was worth stepping back to focus on other things in life, and wait to see if any other options arise with time. If I do have to walk away by choice or by force, I will have extended the amount of time that I'll be able to clear a foreclosure from my record and get back into the housing market again. So to sum it up, my best advice is protect your relationship, utilize loansafe.org, don't go into debt to hold onto your home - in fact the first thing that I did last year was to reorient my thoughts of my "home" to those of my "house" and my "investment" and that's been key, don't put any money down to get a loan mod, any offer that you get should be not signed without running it first through the forums to get others' input, and absolutely pay a local real estate specialist attorney for advice before signing your name to anything (don't fall for urgency tactics by the bank, underwriters, etc.), be aware of your non-recourse status and ensure that you're not loosing that with any new deals, be aware that signing a mod now may prevent you from reapplying for another mod for a set amount of time, be aware that a refi not only may take away your non-recourse status, but a short refi itself will knock 150 points off your FICO score, and then if things go south again in a few months and you have to foreclose anyway you'll also take another 250 point hit (including the 30 days late hits). Best of luck.