Trading up when in negative equity

Hello Folks,
My wife and myself are thinking of moving house to a slightly more expensive one.
Our current house was valued at approx 500,000 in 2007 but a realistic selling price now would be approx 260,000 to 280,000.
We have 320,000 left on the mortgage, so at worst we are 60,000 euro in negative equity.
The new house we are looking at is 290,000.
What would the prospects be with getting a new mortgage to purchase the new house, and what way would it work? would banks take one look at the negative equity and say no way?
Any advice greatly appreciated, thanks in advance..

You could write to your current lender, explaining that you would like to sell your home and giving an estimate of the shortfall between the amount owing and what the house is likely to sell for. You could then ask them to consider a negative equity facility for the balance (if you are likely to change lender) or the possibility of a negative equity mortgage (if staying with the current lender).
In the first scenario, if the banks are operating in a similar fashion to each other and to how they were operating 6-9 months ago, they may write back telling you that you need a firm offer, a letter from your estate agent to say it reflects current market value and a letter from your solicitor saying that the sale is at arms length. This worked in our case but we may have just gotten very lucky.