If you can borrow, the amount will be limited based on some formula, probably a percentage of your current balance.

Outstanding balance of $245,000 with current value of ~$350,000. 

Original balance on the loan was 1.3M in 2009.

It's a balancing act. 

They still have to return the deposits as well as balance I keep on hand with them for minor repair. 

Financials:Purchase price (2001): 155kMarket value: 305kMortgage balance: 300k (1st 132k, 2nd 168k)Mortgage (P&I): 2100Rent: 1795Mgmt Fees: 142Pool Maintenance: 120Taxes and Insurance: 190Cash flow: -800And how my CPA is calculating taxes (this is assuming net proceeds of 296k):Basis: 125,600Gain: 170,400Rental activity loss carryover: 15kTaxes: 39,200 (Fed: 31600, State: 7600.  50k in my original post was incorrect.  

I have heard of investors getting the deed and paying off the 'principal balance' as opposed to the payoff.  

If you have a credit card with a $20,000 limit, and you have a $19,000 balance, that looks far worse than the same card with a $2,000 balance.Your original post says you have a close to 700 credit score.

Specific Worst Case ScenariosThe house a mortgage balance of $63K, sell price is listed for $78K, current rental rate about $850, 3br, 1 ba, 1400SFAny advice is appreciated.

We have even gone as high as 85% foe very strong borrowers if they have very good liquidity ( lots of cash and/or other liquid assets).I didn't mention the balance sheet much because it isn't heavily relied upon at our bank or other smaller lending institutions in this area because they tend to be over inflated by the borrower.