I heard back from CitiMortgage. Verbal proposal 5% fixed reaged to 30 years, reduces payment by about $109 per month.
6.5% fixed (FHA: Ginnie Mae)
$1111 month with tax and insurance
Taxes just over $400 annually
Homeowner's Insurance about $650 annually
New proposed Scenario
5% fixed (FHA: Ginnie Mae)
Basically $1000 per month with tax and insurance
Reverted back to 30 years
Added about $7700 to principal with past due taxes and insurance included
Currently, before this proposal I would due for over $11,000 and change in total by January 1.
As proposed new payment starts 1/1/2010.
Papers are supposed to be on the way to get notarized and return the down payment for plan.