Upside Down Mortgage

Here are the facts about my situation. My sister is divorced and the house and mortgage are in her name. She does have equity in the house and is not upside down on it (not yet anyway). She has moved out of state and the ex is still living in the house.

The agreement was that he can live there as long as he makes the payment on time until he finds something else or the market gets better. Everything looks good on paper until payments are late and communication becomes poor.

My question is can a person just call the mortgage company and say " I no longer want the house you guys take it" realizing there is probably $20,000 in equity in the house?

I realize that walking away from that much money is hard to do but my sister has decided that peace of mind and a clean start is worth it. Any advise would be greatly appreciated.

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