By Jane Sutton
MIAMI (Reuters) - Nearly 1,200 people lined up at a downtown Miami conference center on Wednesday, holding onto mortgage documents and income statements in the hope of saving the homes they are struggling to pay for.
Seated at rows of long tables were scores of loan processing agents for 19 lenders who hold 85 percent of the home mortgages in the south Florida market.
Over seven hours, the homeowners pleaded for loan modifications or other help under a variety of programs aimed at stabilizing the U.S. housing market and keeping struggling people in their homes.
Nearly one million U.S. homeowners have won permanent reductions in their mortgage payments since President Barack Obama's administration launched a foreclosure prevention program in 2009, the U.S. Treasury said earlier this month.
That was far short of the administration's initial projections that the Home Affordable Mortgage Program or HAMP would help up to four million homeowners stay in their homes.
The program, recently extended through 2013, provides incentives for lenders who work with borrowers to lower monthly payments and interest rates, and allow homeowners to sell the homes for less than they are worth or give back the deeds in lieu of foreclosure.
It also provides temporary mortgage assistance to the unemployed and helps owners move into cheaper rental units when their only choice is to give up homes they can no longer afford.
Some of those at the Miami event had lost their jobs or seen their income plunge during the economic downturn. Others fell behind on payments due to illness and medical bills, or refinanced their homes to take out equity during the peak of the housing bubble, only to see values come crashing down when the bubble burst.
"Everybody has a different story about why they're struggling with their mortgage," said Andrea Risotto, a spokeswoman with the Treasury Department's Homeownership Preservation Office, one of the sponsors.
It was the 64th "Free Help for Homeowners" event put on by the Obama administration and the 11th in Florida, where nearly 12 percent of mortgaged homes are in foreclosure, the highest rate in the nation.
More than 17 percent of Florida mortgage-holders are 90 days late in their payments, also the highest in the nation, according to a CoreLogic report earlier this month.
Across the United States, 3.4 percent of homes are in foreclosure and 7.3 percent of mortgage holders are three months or more behind in their payments.
All those numbers have been shrinking as the housing market slowly rebounds. The crowds at mortgage-mending events like the one in Miami have also shrunk since peaking in 2009. Then 2,800 homeowners turned up at one in Atlanta, said Brad Dwin, a spokesman for another of the event's sponsors, the Hope Now Alliance.
Risotto estimated that one-fourth of those in attendance would qualify for loan modifications, and the rest would at least have clarity about their status and their next step.
That clarity was too much for one middle-aged woman who emerged from the meeting and collapsed in tears. She was led out, dabbing her eyes with a handkerchief and holding tight to a sheaf of paperwork.
Robin and Michael Johnson left with smiles and smaller monthly payments on the house they bought for $36,000 in 1982. They said they would have had it paid off this year except the couple "fell for a refinancing" during the boom years and ended up with a $180,000 debt. They fell behind in the payments when Michael Johnson lost his job two years ago.
"I am so, so thankful, very relieved," said his wife, Robin.
CUT DOWN TO SIZE
Elena Hernandez and Ana Balmaseda are eight months behind on the mortgage for the four-bedroom home they bought in 2006 for $450,000. They recently saw a similar home in the neighborhood sell for $280,000.
They are insurance agents whose income dropped when the economy crashed. They submitted their information to a lender on Wednesday and were told they would find out within 30 days whether they qualify for a modification, but were skeptical.
"Nobody qualifies for those programs unless you're living under a bridge already," Hernandez said.
A man who gave his name only as Fred said he was leaving with a clear plan for whittling down his $309,000 mortgage.
"They were able to tell me what to do," said the broadcast engineer who has owned his home for 14 years but has struggled since losing his $150,000 a-year-job. "This has to be cut down to size."
Fred, 57, said he has two work contracts pending and hoped to resume bringing in money soon to help support the household that grew to 10 people when his daughter divorced and moved home with her four children.
"Thank God my wife is still working. She's been supporting all of us," he said.
Beverly, 48, left resigned to losing the home she and her husband bought seven years ago for $350,000. They had top-notch credit, refinanced during the boom, "which just made things worse," then lost their jobs in the health insurance industry, she said.
The couple kept making payments for a year an a half, until they exhausted their savings, she said. They now owe $465,000, aren't eligible for a loan modification and plan to stay in the home "until they tell us we are out. I don't have anywhere else to go," she said.
Irmine and Therman Butts left with the good news that they qualify for a payment reduction that should be final within 30 days. He is a chef who works two jobs and she is a teacher whose income dropped by $20,000 when she was ordered into bed rest during a difficult pregnancy. That cost her a spot as director of an after-school program.
The couple borrowed from their retirement funds and charged up their credit cards. "We're barely making it now," said Irmine Butts, now the mother of a healthy 3-year-old daughter.
They bought their condominium for $180,000 in early 2007, and have seen similar units sell recently for about $35,000, but are optimistic about receiving a loan modification.
"This is like a real cloud and now the sun has come up," Therman Butts said.
(Reporting By Jane Sutton; editing by Christopher Wilson)