One option is Rent to Own.
While you are strongly encouraged to talk to a Tax Advisor, here is some guidance to your
Clearly, you cannot take a loss on your Principal Residence and carry it forward. One eats
the loss on a Personal Residence with No Carry Forward of the Losses.
However you can on a Rental property as it is deemed as an Investment Loss. However,
if the Tax rules change in the future then you may not beable to.
Since, you do not want to pay the $8K tax Credit nor ruin your Credit your best bet
is to rent it out and write off the structure. Clearly, iff you exercise a Short Sale or
Foreclosure, your credit does take a hit for 3-7 years
One option is Rent to Own, but the challenge is determining the price today on a
property that will be exercised to close 3-5 years out.
If however, the stock market crashes and the economy and GDP dives, then there is no guarantee
that you may even get $1900 in rents if the market liquifies. Also, if the Tax structure changes and we
go to a Flat Tax structure, the days of write offs will be done.
In the mean time do find out who is holding your loan, this is important.
Do get in touch to discuss further if you wish.