A little advice please!!!

[SuzieQ]

I think I may have a serious problem. I am a new homeowner as of December 2006. I purchase a fore-closed home single family, four bedroom, two story for 165K. My current rate is 10.16% no PMI, no pre-pay penalties, and right now my mortage is at $1455 monthly. In December 2009, the monthly payments will increase to $1800. When we purchased our home, my husband and I were working at a hospital (which we both still do), but he also had a second job, which was the extra money we used to lived on. Since then, his part-time job had to let him go and now collectivly our income has decreased $16K a year. Currently, I have been managing to pay my mortage and my bills, but have been living from paycheck to paycheck. We live with just the basics, and sometimes, we have to say that food is a luxary and take it week by week. We have no car notes, or live outside our means. And, also, our savings have been depleted drastically, we are holding on to $600. I have been trying to re-fi, to get a lower rate, ultimately, even if the mortage went down like 250 a month, that would al least give us a little breathing room. But because now I am only paying off my mortage and utility bills, there are other expenses/debts that I cannot pay, and are going on our credit report as delinquent. Currently our scores have plummeted and are between 480 and 525 between both of us, so this is making it difficult for us to re-fi. As much as I try to pay my mortage on time, there have been at least four months that I have been at least 30 thirty days or a little more, but Saxon has never reported this on our credit reports. Our credit reports show we are paying them on time. Since I was unable to get re-fied due to the deliquent debts on my report, I contacted Saxon, and told them I was interested in a loan modification. I have submitted all the paper work they asked for in a timely manner, but have yet to hear from them. In the event, I dont get approved for the modification, i dont know what else to do. Just to stay afloat, my spouse and I have been doing alot of overtime at work, but I dont know how much more we both can handle before we jeopardize our health with working so hard to make ends meet. I really would hate to lose my home. Although I am not receiving any foreclosure notices, because I always make sure I pay that mortage payment, Im fearful for the situation we are in, if there was any kind of emergency, we dont have any extra funds ors resources to help us out. Any advice in this area would be helpful. Sincerly Scary