You don't need to concern yourself with hoa debts, back taxes, etc.  

While this doesn't work for everyone this helped us use the equity for another property and pay off a considerable amount of debt.

Our economy is so reliant upon the expansion of debt, confidence is paramount.  

I currently have a rental that is about valued at $86k and my debt is $94k.

Since you have already lost 100% of the income to debt servicing then create a trade off in your calculations.

Needless to say after 2007 my career path took a different direction, and I obtained my BA degree, and since have put all my efforts to eliminate any debt and be ready to focus on real estate investing.

It's the mentality of someone restoring a car by painting over the rust and putting a engine quieter liquid into the crank case and trying to sell it to the highest bidder.

Alternatively, I can take the money from the sale which is approximately 65K and use it to pay off loan mortgage debt.  

.* Swap some of that debt around, put it on a HELOC secured by some other property. * Do it 75% first mortgage, 5% 2nd mortgage.

I worked with Alex Crawfurd at Big Creek Roofing & Restoration last summer.