I need Loan Modification Help and Advice?

Hello – My husband and I applied for a Loan Modification in May. Supplying paperwork, bills, pay stubs all along the way. We recently (6 months later) found out that we were denied for the HEMP Program. So,they are looking into other options, in house modifications. After kicking and screaming, they are reconsidering us for HEMP (or Hamp?) but most likely will be denied again. Here is my situation, I make $ 56,000 a year, we owe $ 198,000 on our mortgage. My husband is a union carpenter, he made out really well when we first moved here and even when work is steady. However, within the last year work for him has been completely dead (due to the economy) and he is getting by on unemployment which isn’t much. We aren’t compulsive spenders, our mortgage and utilities are priority. But we are just about making it now. We were denied because we are told we aren’t terminly ill, divorced or dead. But I always get a different story when I call. Now I’m being told my husband’s unemployment doesn’t count as income and they are just going off of mine. Well, dugh, wouldn’t we be approved then? Even with his unemployment! They keep telling me to send them paystubs and bank statements (not much in the bank either). I guess what I’m getting at is what exactly do you need to be considered for this? If two people are steadily working and making good money, they are the ones that get a modification? I would assume they do modifications to avoid forclosure (in which they loose out also). So what am I doing wrong here, am I missing something? Can someone who has been through this shed some light? Thanks in advance!
Thank you for your response! We are not late on our mortgage (and this only because we are using everything we have to pay it). Putting other bills on hold or paying them late. I’m afraid if we default, our credit will be ruined or we will go into foreclousure. And how do you catch up when you are behind on a payment. Also, my husband works a week here and there. Would they still consider us based on his portion of the income? With or without unemployment? Thanks.
Our mortgage is through PHH.

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