First mortgage 475k, Heloc 200k. Home slightly underwater on total of both notes (low sixes). We were sued by CitiMorgage for foreclosure after being denied mods for a year. Fighting that, attorney advised to stop paying HELOC as chances were good they would not foreclose due to having inferior lien position. He was right for a year but just got served by Citi for the 200k HELOC as a plain vanilla promissory note, not foreclosure. Obviously going to respond to avoid a judgement but what are my options here. Attorney says 6 months left before sale date on first. What are my best bets here, let them get a SJ on the Heloc and then cram it in a BK 7/13? Could I negotiate a settlement for say half on the Heloc and potentially bring it below the sale price of the house at auction or am I screwed. Would like to avoid bk at all costs but wont be burdened by hundreds of k's in debt for life, I have young children. Seems to be alot of nuances here, advice appreciated.