Bad investment. What's my options?

[Bad Investment]

What is the name of your state?What is the name of your state? Washington

Scenario:

I co-signed for my sister on a house roughly 4 years ago. Being in the military, I'm away from the area of the house most of the time.

Last year, my sister lost her job, stopped paying the mortgage, and moved out. I didn't know about this until it was obviously way too late in the game.

Company foreclosed and sold the house/land for roughly a fouth of it's price. Company is sueing my sister for the remainder, up to $150,000.

My sister (not married) is preparing to file bankrupcy and I assume that means the lending company will focus solely on me for repayment.

I live on a military installation, so I don't have much in collateral. Car is 10 years old and paid off, but not worth much at all.

I've been in the military for 17+ years, planning on retiring in 2+ years. My only net worth is roughly $30,000 in savings as I am preparing to retire and start a new career. I am married with 1 child.

Is declaring bankrupcy the right thing to do as I can't afford to pay on the $150,000 for a house I'll never live in since it was sold? I would really prefer to keep my savings in place as it will help as I start my new career shortly.

If I was to have my wife open a bank account in her name only and transfer some of the money into it. Is it considered community/shared property still? My wife was not a co-signer on the house. Any type of "one time" payment to my spouse option or anything like that?

I admit I made a very bad investment and there should be consequences. I just wish it didn't have to affect my current situation as well as my financial future for the next few years.

What are my options?
Please advise.

Bad Investment

[bigun]

See a lawyer now. If the savings is in some sort of ERISA qualfied retirement account, it may be safe. Also, a lawyer may be able to suggest a way to place non exempt assets into exempt assets.