Loan Modification Help - Not Behind

[manktown]

My details:
$512,000 interest only mortgage on my home.
6.5% interest rate, changes in 2013.
Current market value approximately $575,000 (down from $640K a year ago).
Lender is Homestreet Bank, a local in my area.

I obtained this loan through stated income because my debt to income ratio is too high. I have been and continue to comfortably make the payment on the loan, but I'm worried about the rapidly dropping value and the fact that the principal balance isn't going anywhere because it's an interest only loan. My circumstances have not changed since taking out the loan and I've never been late with a payment. I had planned to either sell or refinance by 2013, but at this point anticipate having difficulty making the payment once the rate resets and principal is included. My credit is great, but I can't refinance because of the drop in value and stated income loans are now nowhere to be found.

I'd like to reduce the interest rate to where my payment would be about the same but would also be paying down the principal balance. I'd feel a lot safer watching the value of my home going down if the principal balance was also going down. The last thing I want is to end up upside down in my home, have something unexpected happen, and then have no room to sell the house. What do you think the chances of my lender modifying the rate is? They have a page on their website about working to refi Fannie/Freddie loans (which I'm not) or working to modify people in distressed situations (which I'm not). How should I go about getting the modification? Would the loss mit dept be the right place to start, or not applicable to my situation? Anyone with any insight into Homestreet or suggestions on how to go about this? I truly appreciate the help!