[LHarveyMadman]

When I called B of A last week to check on the status of my modification, I believe that the automated message said that B of A was starting to implement the plan. Admittedly, I didn't listen to the exact details because they did not apply to my situation.

First things first, get all your financial information together. Income information, other debt obligations (e.g. student or car loans), monthly expenses (diapers, groceries, phone, utilities, etc. - pretty much anything that you pay for). Be prepared to give that information over the phone. Don't exaggerate your expenses - if you report expenses that results in too high of a deficit, you may be denied.

Your story sounds like a good one for a modification. You have an interest-only ARM at a rate that is considerably higher than prevailing conforming rates. There is a good chance that your loan is owned by Fannie or Freddie.

One missing piece to your story is that you did not mention what the current market value of your home is. If, by some stroke of good fortune, your home's value has increased and you have about 20% equity, then you might be told to do a conventional refinance. I'm guessing that you don't have that kind of equity after having owned your home for less than two years.

The number that I always called for B of A is 800-846-2222.