Parallels not filling screen. 2 black bars on top and bottom.

I am on a mbp and parallels used to work fine. And for a 2 months or so, I try to run windows via parallels and I have two black bars on top and bottom that are about a 1/4in thick. This makes text really hard to read as well as everything is appearing smaller than it used to. i feel like it started doing it after I installed mountain lion a while ago. I am on 10.8.2 with parallels 7.0.15107. I am on full screen mode and i dont know if there are adjustments that need to be made. When i am on the mac side, everything fits on the screen full screen just like it should.

 

Bump.. Did you or anyone else find a solution to this? I am having this problem now as well.