Refinancing a rental property

[Jim Hiler]

Dear BP - I have a rental property that was originally my primary. I purchased it with 5% down in Sept 2009, at a 5.375% interest rate. Due to my taxes going up, still paying PMI and not putting enough down I'm negative cash flow. I want to Refi to take advantage of lower rates but what I'm finding is that its' difficult to find a bank who will do an investment property Refi at an LTV lower than 75%. My guess is the place is worth $380,000 and I still have $310,000 left on the mortgage (orig purchase was $360k and orig loan amount was $347k). I obviously could lay out the difference to bring the LTV down but I'd rather not. I also looked into Freddie/Fannie HARP program but I don't believe I qualify because I purchased too late. I think the cutoff was May 2009.

I would definitely sell the place if it appreciated enough but assuming I could get $380k for it, I would barely break even after realtor fees and expenses. I do want to sell in the near future and would consider a 5/1 ARM to keep my payment as low as possible and get some positive cash flow.

Any suggestions would be appreciated. 

Jim