[chocolatelab]

First things first. Get the family out where you are.

Second, find the best mortgage broker in your area. Find out what it takes to buy a new house with your 2 scenarios. First 1 being short sale. 2nd being holding it as rental property.

Third, put that sucker on the rental market. Whether its empty or rented you are paying the mortgage (I hope). Rental rates look like they are rising as more and more folks are getting bounced from their homes.

20 years from now if you decided to keep it-I have a feeling you are going to be in a real good position on that property.

Example: We rented out our primary residence and moved to a rental in a new location. It took 8 months but have loan approval if I want to buy another. I think I may still sit and watch the market.