. $2580 of annual returns on a $0 investment is a hell of a return. 

My problems were as follows:I asked them (and have the email correspondence to prove it) to do the annual renewal of the home owner's insurance and their representative said they'll do so.  

Tax (listing claims ~$5900 annual, ~3%)$20 - Landscaping/Snow$284 - Vacancy (8%)$284 - Repairs (8%)$355 - CapEx (10%)$426 - Prop.

Wouldn't that save me $150x12 = $1800/yr and therefore I could look at my return on that investment as 36% annual return ($1800year/$5000), and therefore this would be a wiser option then focusing on a second property until I remove my PMI?

From my experience ARMs typically adjust annually or semiannually so you get a fixed rate (often lower than 15 or 30 fixed) for that period of time.

Is an annual term too long?

It is now worth $209,000, rent has covered expenses over the years, do the math it is a return of over 20% annually.  

Live with my laptop and not worry when the Big Bad Wolf comes to blow my house down.

I also think your annual insurance of $700 is light for the price.  

Once you file the LLC, you are responsible for tax returns, annual filings, etc.