I think the sell the house plan makes sense - the reality is that the OP cannot afford the mortgage repayments. If there is cash left over after the mortgage is discharged, it can pay some of the other debts. The one caveat I'd put on this is that the OP may not get the asking price he expects.
I agree with Brendan. The other thing to consider is that the parents are not currently getting any rental income from the house, so the OP moving in and paying rent could be a win win for both. I'd also imagine that there would be more security of tenure becuase of the family relationship - a very important issue to consider if you have kids and dont want to be moving every couple of years.
Overall I agree with the general thrust of the OPs plans - its better to make an orderly exit on your own terms than let the world cave in on you.
I agree with Brendan. The other thing to consider is that the parents are not currently getting any rental income from the house, so the OP moving in and paying rent could be a win win for both. I'd also imagine that there would be more security of tenure becuase of the family relationship - a very important issue to consider if you have kids and dont want to be moving every couple of years.
Overall I agree with the general thrust of the OPs plans - its better to make an orderly exit on your own terms than let the world cave in on you.