[quote=fredo4]Do banks look at savings or other assets when considering loan modifications or is it mostly (or all)dependent on income?[/quote]

They’ll want to know assets as well.

I’ve rarely seen a good loan mod, and usually they are given out in the more depressed areas. Check out the loansafe forums for particulars relative to who owns and services the loan as there is a huge variance depending on those factors.

There is also a third option, let it go back to the bank and saving the mortgage payments.

And within short selling much is dependent on the servicer. Also within short selling there is the option of short selling but still current and short selling but not paying. The rolling 30/60/90 day lates reporting on the credit report is what hurts a lot if they were trying to save their credit but some servicers/investor combos might not allow non-defaulters to sell short.

Based on the very limited info given, I would say short sale. In fact in most cases with distress and highly underwater homes I would say short sale. If you can show cooperation with the lender and distress then FHA loans become a viable option much sooner for the borrower to rebuy (sometimes immediately).