Here is my situation with HSBC

I am current with all bills including my mortgage payment but have had to put some living expenses on credit cards in order to make ends meet. I do not wish to continue in this pattern. I also do not wish to proceed down the path of foreclosure. Our current mortgage is a first only with HSBC Mortgage Services is $525,000 on an interest only adjustable rate mortgage (at 6.68%). This was initiated last December when my prior mortgage was about to adjust higher (HSBC had us over a barrel). I estimate the current market value to be approximately $430,000 even though the appraisal of November, 2006 had it at $525,000. When this rate adjusts the payment will most likely increase significantly and I will still not be paying anything toward principal. My employer has just completed a 12-14% reduction in staffing. While my position is not in immediate jeopardy, it is unclear what the impact will be on salary increases and potential bonuses. I currently put 5% of my salary into a 401K program and this amount is matched by my employer. A large component of my debt is from the purchase of stock options and ESOP shares from my former company. There was a great deal of capital that was required to purchase these as well as a tax liability since I had to purchase (options) and take possession (grants) within a certain period of time and was thus taxed (as income) at those share prices. Currently, that stock has gone through a reverse split and is worth approximately 2% of the value at the time they were purchased and taxed (at one point, $400,000 worth is now only worth $800) I own my vehicles outright. We have completed a credit/finance counseling course at our church (Dave Ramsey – Financial Peace University). My goal is to retain my house for at least the next ~5-10 years and then to downsize as I draw closer to retirement age, or to downsize now. With the current negative equity, neither are attainable. I have sought the advice of Louise March of savemefromforeclosure.com and she would be willing to help with a short-sale if we couldn’t get HSBC to re-cast the loan. I feel that due to their predatory lending and much over-inflated appraisal, we are in a very deep hole.