Does your wife work?
Does your homestead have more than $60,000 equity?
If the rental properties foreclose, the lender(s) can get a deficiency judgment for the balance of the mortgage after the house sells at a foreclosure sale. Since the market is currently depressed, there is a backlog of foreclosure properties on the market, and not much demand for them. Accordingly, it can take years for your properties to sell, and then that long for the lender(s) to get deficiency judgments.
You should be able to have these judgments discharged by filing a Bankruptcy. You can either file one now or after the lender(s) get judgments.
If you file on your own, your liability for the mortgages will be discharged, but your wife will remain liable - at least until she can also file a Bankruptcy.
However, since she earns so little, there isn't much a judgment holder can do to her, as each can only garnish up to 25% of the amount that she takes home that is over $217.50, and I think that by the time judgments are in place, it will be close to 2 years after the property was transferred.
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