Contact a local lender (use your bank since you're already a customer) and find out if you're allowed to use the equity in your home to reduce the PMI. From my experience as a realtor, you cannot use equity to reduce PMI which means you won't be able to refinance.
Your situation is a major reason why buyers should not buy homes unless they have at least 10% cash for a down payment. PMI is very expensive and a waste of money. However, too many buyers don't budget properly and spend money foolishly. Then when they want to buy a home, they're stuck paying PMI because they never saved for a down payment.