ASC-deep breath-third try a charm?

[Mike]

Good day, everyone! What a great group all of you are!I really wish I'd have found this forum last December, before my first call to ASC. I've been through it and back with them, and I can tell from other posts that this is pretty status quo. It's a relief in some ways, hearing all of your stories and knowing that if I just do not give up, there's always hope.Here is an excerpt from my hardship letter, to give a quick chronology of our situation. I've added some notes in parentheses, to add details:• Self-employed, work from home mom• Gave birth to twins about 3 years ago, requiring me to stop working to raise them• Refinanced with an interest-only loan for a 3-year period; took out a second and remodeled our home to accommodate the newborns (of course we were told it would be easy to refi with the added value to our home)• Lived off of savings and credit for a temporary period (and of course the remodel went over budget), but maintained mortgage payments; no longer living off of revolving credit accounts since my business started up again mid-2007• Prior to interest rate increase (was due to reset Feb 08), we attempted to refinance but were unable due to market value decline• We then applied for a loan modification (December 07 through April 08) and were turned down, but upon further review of details, discovered that our financial situation was interpreted incorrectly (they did not take my income into account, saying my proof was not valid, so they just went off of my husband's. I used my business checking bank statements as proof, because I was told this would suffice.)• I’ve recently landed some long-term contracts for my business and my income is steady and growing• Currently, we are slightly behind in our mortgage (extra interest has been very tough to keep up with), but continue to make every effort to stay as current as possible (due to reset again in Aug 08)Loan amount: $455K (second with Countrywide $89K)Original payment (including escrow): $2625 (6.3%)Reset in Feb 08: $3256 (7.8%)Next reset in August: $3650 (8.875%)It's a $1000/month increase over the past 6 months. Unless I let my credit card payments go, there's no way we can manage this. Like I said before, the first denial was due to insufficient proof of income (the same proof that they verbally approved, and no, I did not get that person's name!). The second denial was due to their determination that we were $1400 upside down every month, which is completely incorrect. They were going off of my old, original income numbers from December 2007, when I had my initial phone conversation. In early June, I re-faxed the 12 page document I sent over in April 08, but am uncertain whether they will take this as a) they already mailed the denial letter and might have closed my file out or b) they will probably want updated financials, which is just a matter of my gathering it all together, typing it out, and faxing it over, except that I have such precious little spare time with two 3-year-olds plus a preteen constantly vying for my attention! My business has steadily increased since that time, but unfortunately, so have the credit card minimum payments (a completely separate story, defaulted rates etc. but I am now successfully working with the creditors to bring my rates down). Gasoline prices and other increase to cost of living has just kept us barely breaking even each month, at the OLD house payment amount.I was just about to hire an attorney ($3K in fees, which would have been well worth it 6 months ago had I known I would spend so much time and heartache trying to work this out) when I landed upon this GREAT forum.Any words of wisdom? From what I've read, it seems like I would be well served to ask for the original rate, but the tricky part is establishing our income at such a level that we could afford a P&I payment (plus escrow) for a 30-year period, but not afford the new terms they are resetting the interest-only loan at.HELP!