We've been told there's no hope (Mich)

[Joel Fraser]

Ok, so I've been reading this site every chance I get for a few days now. It seems like some people are getting somewhere, I need to know if anyone thinks there is for us. I really don't know what I am doing dealing with our mortgage companies or anything, so maybe I have not exhausted all possibilities, but here's our story. We purchased our home for $144,000 in 04. It was an 80/20 loan for 100% of the price. My husband is self-employed, so we did a stated loan. We were doing well in the business so we figured we could re-fi when the 2 yr ARM went off. The economy started to take a down turn just before we had to do that, so all we could get was another 80/20 2 yr ARM for $150,000, also at 100% of value. This is where things get scary. The payment went up slightly, but we had that 2 years looming over our head like a vulture. It is now here, and everyone I talk to says we are going to end up losing it. Our 1st mortgage co. is Homeq, who finally told me after 6 months of sending paperwork that they don't do re-fis so we have to go somewhere else. They also told us they could help us if we paid on time! or if we made more money!! Our 2nd is Saxon and they have yet to respond to the paperwork for a short sale. I spoke with someone last week about the "Assist" and "Rescue" programs Michigan has rolled out, but we don't qualify. Our homes' value has declined, I think to about $130,000, our credit isn't great because my husband hasn't had steady work, but we've made a mortgage pmt every month. Also, being that he is self-employed, and I can't find a job worth putting 3 kids in daycare, we don't show enough income to support the loan, or any new one. I understand that no one is really doing stated loans like the ones we got, but is there any hope? We are thinking about not paying this month and just start saving for a rental or something. I am frightened beyond belief, but will work to save the home...any suggestions!!