Should I refinance my rental property to make it profitable?

[Steve Johnson]

I'm a wordy person,  sorry if all this writing seems like too much info,  but I think it's relevant, albeit it's nearly an essay. 

I'm torn about refinancing my rental property.  Right now it costs me about $400 a year to keep it.  

I purchased a mobile home on an acre of land in 2007 for $150k with owner financing at 5%,  $800 a month. The loan balance is now about $70k with approximately 9 years left on the loan.   It was an intra family purchase so I retained the old tax basis,  it's less than $400 a year.  The current value is around $185k. Had it been a stick built home the value would have easily doubled.....

I started renting the property out in 2012 or 2013 at $925 a month.  That covered my mortgage,  taxes, and insurance at the time.  The current tennant has been there for 7 years and he's great,  he does ALL the repairs,  I only pay for the larger materials expenses (like a water heater), but he pays for all the smaller stuff,  faucets,  plumbing,  outlets,  etc.   It's a 40 year old mobile so it needs lots of maintenance.   He still pays $925,  although I probably could get $1200 a month now, I highly value his property management so I keep the rent the same. 

Insurance increases are the only reason I lose about $400 a year now.   

I have the option to refinance the loan into a 15 year with 4% interest.   My costs for this refinance are contract, notary, and recording,  it would be via the same owner finance lender (family) I expect this would cost me maybe $500-$1000. This would lower my monthly payment to around $520 a month,  turning annual loss of about $400 into an annual gain of about $2900.     The drawback is the overall increase in interest from extending the term of the loan and the longer payoff date.  Although it's not massive, it's about $7,000 more in interest over the life of the loan. 

It probably makes sense to do the refi.   The annual gain in rent outweighs the overall loss in increased interest over the life of the loan.  I really like the idea of paying the property off in less than 10 years,  but it's probably stupid right?  I should just do the refi so the property is profitable?

Other alternatives are selling the property to purchase a stick built rental,  something that will appreciate more and qualify for traditional lending.   Finding the right place within the window for the 1031 exchange could be difficult with current inventory.   I'd lose out on the very low property tax I enjoy now too.   

If you were in my shoes,  what would you do?