My question involves a foreclosure in the State of: Georgia

About 8 years ago I had a family member that was not able to qualify for a mortgage and asked me to apply for the loan. I was told that they would eventually get the mortgage in their name. Well 8 years later that has not happened. In fact 3 years ago I secured a 2nd mortgage on the property for renovations.

They have been living in the house & have been current on both the 1st &
2nd. About a year ago they moved to a smaller place & put the property on the market. They continued to make the payments on time. About 8 months ago with no offers on the property they decided to rent the house to a couple while it was for sale to help with the payments.

That couple recently moved out & they have been unsucessful in finding another tenant or in a buyer for the property. The 1st mortgage payment is around $2000, the 2nd is around $1200. The payoff is approx $475,000 with a recent apprasial of $800,000.

Now this family member is telling me they can not continue to pay the payments & want to just walk away from the situation. The payment has not been made for this month as of today. I have a good job but I am not able to make that kind of payment & keep my own family expenses going.

My question is what options do I have? Foreclosure??...Bankruptcy?? Short Sell?? How will this effect mine & my husbands assets? What should we do?? Thanks!