Which is better choice? Foreclosure or Bankruptcy?

My husband and I purchased our home in April 2006 for $137,000. We financed HomeDepot, Lowes, and Amex to renovate the house. In total, we financed approx $20,000 for repairs. In Orlando when we purchased our home, it was the cheapest on the amrket by about $100,000, so the inital remodel was well worth the money. However, since then the market has dropped and our house that we invested about $170,000 to own, is now worth about $90,000. On top of it we still have the credit card debt due to my husband being laid off from his job as a home builder. We have two cars: a 2006 Dodge Durango family vehicle financed with about $15,000 left on the loan, and a 2008 Dodge full size truck for my husband financed with about $32,000 left. Our disagreement is huge:

I want to file bankruptcy on the credit card debt and his truck, and keep the house and the family vehicle . This way we have the mortgage on his credit to keep it going, and the Durango on my credit to keep it going.

He wants to give the house back, take the forclosure on his credit, and keep the truck and credit card debt. Which by the way, the credit card debt is for the house we would no longer own.

I was told that a forclosure stays on your credit for some time, and ruins your credit worse than filing bankruptcy. Any help would be greatly appreciated!

-T

Both will destroy your credit and send rates possibly up into the 30's...so I would be careful about that CC debt.

You really should have a thorough session with respected bankruptcy counsel.