Getting out of Negative Equity

[Supada L.]

Hello,

I have a long-distance rental home that is NOT in a good location and is worth less than my mortgage balance of $60,000. My listing agent suggested two options:

1. Sell it to the investor for a bit below $40,000 cash.
2. List it for $50,000, which, after fees and everything, it would leave me about $40,000 anyway.

I am thinking of listing it for $60,000 and see if it sells. Would this be a good idea? Is there other options I should consider besides home improvement? (The home improvement is another drama I have dealt with.)

Thanks in advance!

[Andrew Syrios]

The market is extremely hot so it might be worth a shot. But I would try to avoid the "can't have a loss on this" mindset. This is a common bias that is irratiooal. Investors make lots of deals. Some will win, some will lose. A $1 profit isn't an OK deal whereas a $1 loss is bad. Both are just about equally bad. If this deal is bad, get out of it, even if it's for a loss. Then just move on.