Well, I'm going to take a guess and give you the technical timeframe for a California foreclosure which is usually three months of default, three months of the Notice of Default period, then three weeks for a Trustee sale. All told, a little under seven months from the first missed payment to the foreclosure auction. With that said, the actual timeline could be much longer than that, based on possible loan modification and/or your loan servicer's foreclosure load.

You have to live somewhere, so it's important to consider the difference between what you pay now, what rent would be for an equivalent property and what your payment might be under a proposed loan modification. The target for a loan modification under the Hamp program is a 31% front end debt load. That means they'll take your monthly gross income and probably your husband's monthly unemployment benefit and consider 31% of that as the amount your payment should be. That payment would include principal, interest, taxes, insurance and any association fees, but does not include any possible 2nd or HELOC loan payments. The new payment is reached by reducing the interest rate by 1/8% until the 31% point is reached, or the interest rate floors at 2%. Trial period for the new payment is 3 months minimum before actual modification approval.

You should be able to get an idea of a possible modified payment just by doing the math on income which will allow you to make a rent vs modified payment comparison. Your back end debt, or total of all your debt payments(including the possible modified payment) also should not exceed 55% of gross monthly income.

If it still wouldn't make sense for you under a modified loan, list it as a short sale at market value because if the sale goes through it will help somewhat with your future credit. Short sales can take a really, really long time to go through, although I'd expect that servicers will eventually catch up with the backlog.