What I am about to write may seem a bit daunting, it is an effective approach to dealing with the situation you face.
Consult with an attorney in your state about your rights and liabilities, and whether you qualify for bankruptcy regarding deficiency balance you face on your second home. If you do, take careful notes of what the attorney explains regarding what will happen to the deficiency balance if you file for Chapter 7 or Chapter 13.
Call your mortgage servicer. (In your case you mentioned it was Wells Fargo.) Explain what the attorney told you should you decide to file for Chapter 7 or Chapter 13. Be non-emotional and business-like, and tell them their behavior will dictate your decision: a negotiated settlement on the junior mortgage or bankruptcy. The negotiator will probably want to see a financial disclosure to determine if you are totally forthcoming about your finances. In this situation with such large numbers at stake, provide the negotiator with the financial disclosure. The negotiator will take a week or so to study your disclosure. If the negotiator is stupid or evil, they will tell you to go ahead and file for bankruptcy.
However, if the negotiator is smart and believes you are willing to file bankruptcy, the mortgage servicer will relent and negotiate a settlement. Negotiations may take one phone call, or may go on for several months. In my observations, negotiators work on a monthly and quarterly basis, and negotiations may be more fruitful at the end of the month (or quarter) instead of the beginning.
I realize bankruptcy is frightening and pushes emotional buttons in many consumers. You need to work though that and realize this is a business decision for the mortgage servicer (it is not personal to the people at Wells Fargo at all), and a simple financial decision for you.
Start negotiations at 10 cents on the dollar. Depending on your circumstances, the final settlement may be higher.
I hope this information helps you Find. Learn & Save.