Legal Question in Real Estate Law in California

First, I'm not surprised that you've had difficulty interesting a lender in refinancing you condo. Even someone with the balance sheet of a Saudi prince would have a tough time getting a loan on a property with little or no equity, to say nothing of under water. Lender have much higher expectations in 2013 than they did, say, in 2007. Tougher rules to follow, too.

As to whether to stop making payments and endure a foreclosure, I'd say this is definitely a mixed bag, with plusses and minuses that need to be weighed. What is your income? Where will you live? Can you get by with an impaired credit score? What is the possibility that the market value of your condo will recover soon? You should try to get personalized advice from someone (lawyer, real estate licensee, accountant) with whom you can sit down and go over all the pros and cons as they apply to your situation.

Finally, there is (sometimes, anyway) the in-between alternative of a short sale, which is kind of a pre-negotiated foreclosure. You may want to sound out your lender and one or more local real estate licensees on this as an alternative.

You don't foreclose, the lender does. Stop making payments and they will. You have no 'power' to compel lenders to refi, but you can ask and persuade. Why would a lender refi an under water property? When you can give them an answer and an incentive to do so, they might. But, many ask, few are successful.