hi william. sorry to hear of your bad luck here. but, there is always one good word of advice. never give up. yes, your property is underwater right now. if you can afford to keep making payments on both loans, please do so. sure, on the one loan, you are basically " paying on a dead horse". there really is nothing you can do about that. over time, with making sure payments are being made on both loans, you will overcome your bad credit rating simply by making the payments. in that time, should the market on your home increase, you may overcome the negative equity also. only time can help you right now. in the meantime, look for other house deals that you can make. maybe they will not be the level of what you were dealing with in the past, but as long as you are making money, thats the goal. keep moving forward. hurdles in life are put there to teach us a lesson. learn all that you can. 

If I'm beating a dead horse by bringing up a question that's been asked a million times, I apologize. 

You'll get a better rate and avoid having to discover all the things you don't know while racing against the clock to keep your deal profitable.

,Remember that it is your house, so legally you can rent it to whomever you like, as long as you don't discriminate based on race, gender, religion, Etc.

I currently work full time as a software engineer and my goal is to use real estate to enable me to quit the rat race within 10 years. 

That becomes a race to the bottom.

I understand the shelf life of CRE and I see that this isn't a race I'm just not okay with the socio norm.

Off to the races.- Experienced some CapEx challenges.

Get you a cpa and you're off to the races.

I've had too many experiences where I've ridden that horse too long.