Thinking about filing Bankruptcy NEED HELP!!!

[cahomeowner]

I borrowed against my primary home to purchase 4 rental properties. When the mortgage meltdown hit the properties I found myself with properties that were upside down.

I have been trying to short sale the properties for the past year and a half. anyone who thinks the short sale process is 3-6 month process is in for a rude awakening. the banks are so slow by the time you get a response the BPO is old, the buyer has walked or the market values have decreased even more. I thought short selling the homes would be better (on my credit) than a foreclosure. I have been dealing with the short sale process for quite some time and you can imagine the number of phone calls, faxes I had to send, updated financials, etc.

We are finally at a point where the banks have issued their approvals and we are about to enter into escrow. Some banks actually indicate in their approvals that they will waive their rights to pursue a deficiency and others will not. I am so frustrated with the process.

My main goal is to save my primary home:

$500K first wells fargo
$150 2nd wells fargo
$100 3rd wells fargo

the 2nd & 3rd were helocs that I borrowed to purchase the rental homes. I want to save my home but the bank will not even consider a loan modification until I sell the rental properties and can show a surplus......if I had a surplus not sure why I would need a loan mod?

in any case I thought I could short sale the rental properties and then get approved for a loan modification. I have been following the obama administration and their FHA secure expanded program, hope for homeowners, Affordable Home program or whatever the program of the month is called. What most people don't realize is that those programs that the govt promotes to help people save their homes is dependent on a.) having a fannie mae or freddie mac loan b.) this is a voluntary program meaning the lenders have to voluntary agree

my experience is that the likelyhood of getting your home refinanced with a principal reduction and payments reduced to 30% of your income are pretty slim.

I went to see a bankruptcy attorney today who suggested that I not short sale the rental homes because I could have tax consequences or worst a deficiency judgment filed on me later. She said if I filed a chapter 13 and surrender the rental properties that I would have a good chance of keeping my primary residence. Also I would not have the tax consequence or potential deficiency judgment filed on me later.

She also said I would have a good chance of getting the 3rd loan discharged because the current home value is around $600K. This peaked my interest because I would be able to afford the 1st & 2nd and if I could get the 3rd discharged then my mortgage is now in line with the current market value.

Now I understand chapter 13 would keep me in a payment plan for 5 years. My goal is to keep my primary home and hopefully the market will rebound and I will see my equity return.

I was wondering if anyone has a similar situation like mine and was able to get their 2nd or 3rd discharged? Were there some things that I need to look out for? Did the bank put together a reasonable loan modification or did they just keep your payments where they were before the Bankruptcy? Was the loan modification proposed before the chapter 13 plan was confirmed? what was the timeline?

I would like to hear your success story. I also appreciate any suggestions or discussions.

please note: I am not asking for legal advice and I have seeked legal counsel. I find this forum extremely helpful because there are lots of people that have experiences that I can learn from.