FAFSA Question - If I have an asset which net worth is negative ...

Paying for College
1

The net worth of an asset is the current market value of the asset minus any debts secured by the asset.

If the net worth of an asset is negative, should I

Option 1, reported as zero value

Option 2, reported as negative value, to offset the positive values of other assets.

Thanks

2

What kind of asset are you asking about?

3

Rental properties which are underwater.

4

I just looked at the FAFSA instructions, which say “if net worth is negative, enter 0.”

But I assume that’s for the entire category of “assets.” My guess is that for an individual asset with a negative value, it’s considered to have zero value when the assets are added up.

5

A property that is underwater has an asset value of 0.