A word of caution to you about the bankruptcy, if you file while you're working on the short sale it will stop the process. When you file bk there's a stay placed on the property and the lender can't do anything with it until they can successfully petition to have the stay lifted. Once that stay is lifted they are FAR less likely to be agreeable to a short sale. I know this because I deal with it every single day. You have to decide which you want to do more, the bankruptcy or the short sale. You can't do both at the same time.

