I'd look at the positive here - it sounds like you had your Murphy's Law, nothing went right day, and:

1) It wasn't completely catastrophic. 500 isn't a bad starting point.
2) You learned a lot about yourself and how you respond to the GMAT.
3) You got your nothing-went-right day out of your system.

The last point is a little superstitious, but there's some value in it. It's much better to have a bad test with two months before your official test than to have it one week prior. You have plenty of time to improve on it, so I'll focus my advice on that second point. From this test:

1) You know that you assumed that you knew more than you actually knew. Be specific in highlighting those knowledge gaps for yourself, and take time to get fully comfortable with them. You know that you have plenty of time on test day, so:

2) Determine which questions you made silly, rushed-for-time mistakes on. If you had that much time left, you probably made some careless mistakes that you could theoretically make again under test day pressure, so be aware of them and train yourself to recognize potential trouble spots when they come up.

2a) Find places where you simply gave up on the concept because you didn't know it, and see if you can return to them and teach yourself the concept given unlimited time. You'll probably realize that you actually now know more than you demonstrated on the test, but because you were pressed for time you didn't give yourself time to work through the thought process. If you take your time now to prove to yourself that you do know more then you now think you do, you'll be much more confident on test day, and you know that you have the time to invest in it.

3) Recognize that 500 is a starting point on a day on which you managed your time poorly, were particularly distracted, and didn't have a proactive, positive attitude. With all of that in mind, you have every right to expect that you can improve significantly. You don't need to "improve by 200 points" to get to 700; you need to find 200 points that are better than this score, which you can do by:

Managing your time better. I'd bet you lost somewhere in the neighborhood of 20-40 points by rushing when you didn't have to.

Staying focused. Again, you probably lost up to 40-50 points by not reading as carefully or staying as concentrated as you should have.

Improving your knowledge. Here, the sky is probably the limit. Anything you didn't feel comfortable with conceptually you should be able to fix, and you'll also develop a better understanding of the question types themselves. The BTG forum is a great start for all of that, and as you find other resources to help, you can build your score pretty substantially from a fairly cold start.

With two months to spare, probably something like 50-100 "easy" points to get by focusing and pacing better, and plenty of resources to help you expand your knowledge of and experience with the test, you have a lot of reasons to be positive.