Good answers already, and Vicky makes a good point.

If you could get by with just the first mortgage--if it's the second mortgage that's killing you--one strategy that investors use is this: Approach the second mortgage holder. Say: "I know you hold the second mortgage on 123 Main Street. If this house is foreclosed upon, you'll receive absolutely nothing. It'll be totally worthless. I'll give you $1,000 to remove the mortgage. I know it's not a lot, but it's better than what you'll get in a foreclosure."

Play around with the numbers, of course. But that's one strategy that investors use to "build" equity back into a property. Example: Let's say a property was bought for $300,000, and it has a $240,000 first mortgage and a $60,000 second....probably at some pretty high interest rate. Today the property's worth $270,000. There's no equity in the property. An investor gets involved and offers the second mortgage holder $5,000 for the second. The second is removed. Now there's only the $240,000 first plus the $5,000 that it took to remove the second. Suddenly the house went from being $30,000 upside down to having $25,000 in equity. And the payments are a lot more manageable.

If you can do the same thing, that might be a solution to your problem.

I will just add this - despite the mortgages being removed from the home; YOU may still be liable for the deficit. I suggest a short sale if you can do it. You at least have some negotiating power with short sales.

From what I have been taught - any junior liens get erased, including the second. Tax liens remain, however.

It would be best to speak with a real estate attorney for questions of this type.

Have you spoken with a real estate agent regarding the option of listing your home as a short sale so that you can avoid getting a foreclosure on your credit report?