Underwater rental property

[Roy Vereen]

Hello BP,

I have had a rental property for the past 5 years.  The property value is underwater due to the second mortgage on the property.  I purchased the property as a primary back in 2008 with a 80/20 mortgage.  I have refinanced the 1st mortgage but the secondary lender will not let go.  With the refi of the first loan, I am almost breaking even with my rent income.  I want to build a buy and hold portfolio and my thinking is I can start with this property.  But I am not so sure now.  If I could get rid of the 2nd mortgage, I will for sure break even or possible cash flow.  Are there any creative ways to deal with this second mortgage without doing a short sale or foreclosure?  Should I do a short sale and start over?