Mortgage Insurance purchased without our knowledge-demanding promissary note

We purchased a home in 2004, refinanced in 2006 (Nevada), both times avoiding the required mortgage insurance (refinancing with enough perceived equity in 2006 allowed for this). The house is now $150k under water and after some financial hardships we decided to pursue shortsale. BOA sold our loan to SPS Portfolio Servicing 1.5 years ago (likely for pennies on the dollar) and at first they were easy to work with (we received a letter stating they would not pursue any deficiency judgements if we reached an agreement on a shortsale). Fast forward 8 months of waiting, stalling and resubmitting paperwork (our financial situation improved in that time so they became less willing to take a loss at some point) to find out there is some mysterious Mortgage Insurer (apparently purchased by SPS?) attached to the loan who refuses to allow the shortsale without us forking over $10k. Is this practice legal? We believe our realtor/lawyer is gaining some incentive to push this through without question but we feel like we have no recourse since we are under contract for them to represent the sale. Any advice?