WASHINGTON - Judy Barillari recently lost her home in a house fire. There was nothing she could do to save it.
"You see this on TV all the time, but you never think it's going to happen to you. It's devastating," Barillari said.
On Friday, the Obama administration announced efforts to put out another kind of fire: to rescue millions of struggling Americans burned by defaulting on their mortgages and on the brink of losing their homes.
The changes aim to help unemployed homeowners and those who are underwater - or, who owe more on their mortgages than their homes are worth.
A Six-Month Break?
For the first time, the program will help out-of-work homeowners by giving them a 6-month break while they look for work. The banks are also getting incentives to make temporary loan modifications permanent and to offer refinancing options to underwater homeowners.
Those eligible would have to prove financial hardship, and their monthly payments must be greater than 31-percent of their income.
Home foreclosures are on the rise, despite the administration's effort to prevent them. The growing crisis was the subject of a Capitol Hill hearing Thursday, March 25.
"These keys represent what will happen just while we sit here talking about what needs to be done," John Taylor, president of the National Community Reinvestment Coalition, said. "These are the amount of homes they are going to help out of the lot."
Critics say that means the program was not working.
"The Obama administration is really suffering from having over-promised things that I think were very hard to deliver," Christopher Mayer, with the Columbia Business School, said.
Millions in Foreclosure
Right now, 4.5 million people are in foreclosure proceedings or 90-days delinquent. That's on top of another 10 million who are paying more than their homes are worth.
"Families are being destroyed because of the fact that mortgages are not being paid and a lot of them, if they could get modifications, they would be able to work it out," Rep. Edolphus Towns, D-N.Y., said.
Meanwhile, the administration admits that some people will not be able to stay in their homes because they bought homes that were more than they could afford.