You need to consult an attorney who does a full Real Estate practice. While a short sale is an easy answer for us here, and may be the best solution for you, there are others you need to be informed about and consider. I use an attorney with all my short sale clients to review a full range of options. Sometimes a Bankruptcy is best, once they advised the client to let the home go in foreclosure, Sometimes an attorney may have more success negotiating a loan modification on your second mortgage than you can.
Don't jump on the first solution without being specifically informed of all your options. As an agent, I'm not licensed to give BK advice, but an attorney can. Laws vary in every state, so find a great real estate attorney and consider all your options, but do it immediately. Your second mortgage may not wait around.