Rental Property Advice - Pay down loan to remove MIP?

[Lauren Huffaker]

I have a rental property that I purchased to live in when I was still in school and when I purchased it, I put down the minimum to buy it so it has MIP tacked on. It is an FHA loan at 5% interest (fixed) - 30 yr. I bought the house for $119,000 appraised value and have only been making the minimum payments since I purchased it and it is paid down to about $101,000. The value of the home now is about $155,000.

My total payment is $930/month and it generates $1,050 income every month.  I am not making any $$ on it, really, because after repairs, vacancies, etc. it eats through my generated income.  I have kept this for a long term investment but I wouldn't mind being a bit smarter about how I am handling the property and looking into options.

I currently pay around $100/month in FHA MIP. I have the cash to pay the loan down to 78% of the appraised value to remove the MIP.

What would you guys do in this situation? Look into refinancing? Pay down the loan to remove the MIP so it generates a bit more cash flow? Get a new appraisal on the property so that MIP is removed (or do I have to refinance for the new appraisal to matter)? Just exploring options here. Thanks!