[DOTIRED1]

We received a summons 12/30 and we are wondering which would be the best way to proceed.-- bankruptcy or foreclosure!we have about $35000.00 in debt plus the house that we do not want to keep. Had a really good payment history until 01/08 when husband was laid off- then had back surgery- and finally employeed after 10 months.
Which would benefit us in the long run.

[DoulaLC]

Have you discussed the possibility of a short sale? Where the lender agrees to let you sell the house at a reduced price. They don't lose out on as much money as they would with a foreclosure, and you get out from under the house. Banks really don't want your house back if it can be avoided.
Do you have other living arraingements available to you? Would you be able to pay your other debts without the house?
If you would still be very much strapped to try and pay debts, sometimes bankruptcy is an alternative, but you have to weigh the pros and cons... biggest con being that it will stay on your credit report for a long time and it can be difficult to get some loans. However, it is not impossible, they just won't be at a favorable interest rate and you will have plenty of places more than happy to help you get back into debt. So if you go that route, be very careful how you handle your finances in the future.