I agree with Kevin that you should talk to someone, however if it were me, I'd be talking about how I could get out from under the home. If you're insistent about keeping the home (because pretty much every option you have to get out from under the home will damage your credit - albeit that can be overcome in a couple short years) I would consider trying to sell it via lease purchase. You can often collect a higher rent that way.
If you can't find anyone who wants to lease purchase it, I would also look into renting it out to Section 8 tenants. Section 8 means you collect market rents (granted, rents are down in your area) and often with most of it paid directly to you by the government. That can relieve some of the stress of renting the house.
It sounds like you are precariously close to an even worse situation. One month of a tenant not paying rent or one unexpected repair can change things for you for the worse. I hope you can figure out a solution before that happens. One ray of hope is that I actually know people who have had their payments go down recently due to resets. I wish you good luck and hope for the best!
You may consider consulting an attorney familiar with bankruptcy, short sales, and loan modification procedures. My hope would be that their experience and advice may help protect you from more extreme circumstances.
Hoping to help you take advantage of the market – when you are ready.
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