First of all, I would have raised to 400-450 the flop. Given you didn't do that :

No flush possibility, no str8 possibility (open ended at most), I think he may have 2 pairs J8 or 86 and he is value betting it.

If he has KJ or QJ, he his playing very strong, but since you called his bet he may think you have AK or AQ or a pp lower than a J, so he bets to take the pot. I don't think he has a set, too large a bet.

I would call the 500 and call almost any bet on the flop. Do you want to risk it all with AJ? If you call and fold the river, you still have 1750...better than nothing.

River to follow... obviously you called...