Refinance or suffer through the loss

[Jason Ianacone]

I have a former primary residence that I was never able to sell due to the market crash in 2008. Here is my current scenario:

Balance: 150,968

Type: FHA

Rate: 5.0%

Payments: $1,219.12

Maturity Date: 1/1/2040

Rent received: $1,150.00

Refi Terms

Balance: 160,800

Type: Conventional

Rate: 3.375% (3.153% points)

Payments: $954 (drops to 920 after 7 years due to MI)

Maturity Date: 30 years from closing

Rent received: $1,150.00

It is tempting because I could have positive cash flow finally, but I am adding 10 years onto my loan. However, it is a rental, so the whole point is to make money right? I have talked to the property manager and they don't think it will sell for profit. It would take some repairs/fixing up, loss of rental income, plus they are still building homes in the area for about the same cost. Any advice would be appreciated.