pay off out-of-state mortgage or invest elsewhere?

I own an out-of-state property and have enough cash to pay off the mortgage ($180K, currently at 7.5%, paying intesting only). The rent I’m getting does not cover the expenses for that property. I’m wondering if I should pay off the mortgage? or invest it elsewhere?

Opportunities abound now for those with cash. In this era of deflation, cash is where you want to be since it becomes more and more valuable each day. Plus, there is a certain safety and security in having cash during recessionary times. That is unless of course the property is bleeding you dry, in which case your other option is to sell.

This is a cost benefit analysis. If you pay the property down, will the return on your investment equal or exceed your required ROI or that available from other possible investments?

Understand that once you pay the property off, retrieving the money for use elsewhere will only come from either selling it or refinancing and both of these will be difficult in this environment over the foreseeable future.

Do you see potential in this property? Or, was it a mistake with little reason to expect to make a return? If the latter, sell it, take your lumps, and move on. If the former, do the ROI analysis.