Non-appreciating market refi question

[Rich Wilken]

Hey all, thought I would seek your advice. I own two SFH rentals in a flat market that is not appreciating and will most likely never appreciate. Both properties are on 5 year balloons (20 yr amort.), with one of the loans coming up for maturity .I want to refinance both prior to rates going any higher but I am torn over whether to hold both in a commercial loan for 5.5% giving me access to a LOC on them and not tied to personal credit (excellent credit), or to hold both as conventional Fannie Mae loans with a longer term, 20-30 years, and cashflow a little bit higher. I have roughly $70k in equity on both, one being worth approximately $105k, the other worth approximately $75k.

I am interested in long term holds on good SFH rentals, as I have other projects in the works for shorter term gains. Just not sure these two are worth hanging on to. Any thoughts are appreciated.

Rich