I'm having the same problem you had with the upper thread. It seems to get caught (producing your "third" thread) under the needle plate in the machine part that holds the bobbin case. I can avoid difficulty if I use the automatic thread cutter. Unfortunately, if, with the needle in the up position, I try to pull my material away to manually cut the threads, I often meet resistance and I appear to be pulling out 4 threads, not just two. This occurs especially when I use the reverse stitch lever, but at other times, too. Is you problem still solved or do you still have reoccurring difficulties with this problem?