I use the three hole bar as a thread guide. I put the thread going straight down in the far right hole only. No problem with the auto thread cutter unthreading the needle when doing it this way. The tech told me the three holes were for speciality threads that needed more tension. The manual isn't all that great explaining anything but it's a great machine. I have had mine apart many times and it's simple to clean and see what is not working if it does mess up. I won't take the hand wheel off again, the clutch is complicated to get back in place. Do not keep an extra spool of thread not in use on top of the machine. The wheel will suck the end of the thread and wind the wheel full and you won't notice until the machine will start to bog down.

I love mine too! It's nice to have a simple machine that sews great. I do have a problem with the needle threader. It never works!