I think Hercules hit the nail on the head when she said that the pressure that makes your DH talk of suicide is just not worth it, I think you need to have a major re-think of your lifestyle. I would imagine that when you think about it, having had a sick child puts the whole lifestyle thing into perspective and what is really important is that you are all healthy and happy.
My DH became depressed about 2.5 years ago after he was working really ridiculous hours for a salary that was pitifully small for the amount he was working. I know how hard it is to see your DH like this, but from my experience it is now down to you to get this sorted. My DH was in no fit state to be able to cope with sorting out large amounts of debt like this. Luckily our debt was fairly small but we did end up using some money that was raised by re-mortgaging to improve the house, which wasn't ideal.
To give you hope, he is fine now. Off ADs and coping really really well with his mother's very drawn off lost battle against cancer and having his current job on the line in a meeting where a company decide whether they will be buying a product he has just designed for his current boss. A key part of this I believe is us facing up to our financial situation and dealing with it. We now have no credit card debt now and have ISA's which are there to offset our mortgage, also some money to fall back on if he does lose his job.
I think as others have suggested that you do have to have a radical attitude shift. You are saying that in your opinion the cars aren't a problem, I would argue that they are. As people have pointed out, the banks perceive that they are and have you sat down to work out exactly how much they cost you a month ? I know our motoring costs for insurance on two cars with the MOTs, servicing & tax comes to £130 a month. The cars are both paid off (old but do the job), so that amount combined with £32 a year Autoaid are our total car costs. I really wouldn't get your Mum to write that letter, you just don't know what will happen in the future and it is unfair to involve her in something that is basically fraud.
You need to start making every penny count. £5 for lunch here, £3 for a magazine there - do each one once a week for 2 years and £832 will have vanished without trace.
We have found that having a weekly cash amount for food etc works well. Once it is gone that is it until the next time the money is due to be withdrawn. We have a Makro card and I allocate £50 a month for a shop there which usually covers cat food for the 3 cats, a big box of potatoes, sack of onions (£2) toilet roll, washing powder, dishwasher tablets and salt, teabags & cheese. They have special offers on frequently and I now have enough washing powder to last us for months. Start going to a Lidl or Aldi if you haven't been. We have a bread maker so haven't noticed bread going up.
Meat from our local farm shops works out to be cheaper than the supermarket and much better quality. We have just changed energy supplier to Eon which is saving a couple of hundred pounds a year, got £55 cash back by going via Quidco and we'll get 600 odd Tesco clubcard points which will be converted to deals for a treat in the summer holidays. We also have National Trust membership which means we get days out and free parking on the beach for £82 a year.
I log onto to the online banking every day to check the account. We have a monthly budget which I've gone through time and time again to adjust so that we save in advance for things like Christmas, birthdays, haircuts (I have a good mobile one who charges about half the price I would pay if I went to her at the salon she works), clothes (kind friends hand these down for DS so rarely need to buy for him).
The fact that your house has been on the market 3 times concerns me a little. I know things aren't moving at the moment but they were previously. Were you totally realistic about the amount you put it on for ? Might be worth having another look at this, or if you can't move, can you let out a part of it as Expat suggested ? Or what about foreign language students ?
Sorry this is long and rambling, I hope there is something that is of use in there somewhere. Good luck and I hope you get some good advice when things open again on Tuesday.