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NEW ORLEANS -- Several major lenders are freezing home foreclosures in 23 states, including Louisiana, after possibly cutting corners on paperwork to speed up the process.

That gives some a few more months in their homes, but many more are on the verge of foreclosure, and a federal program designed to help people keep their homes is full of roadblocks.

When Jackie Whitney turned to the Life Impact Center, she was hoping for exactly that: help making an impact on her mortgage.

'I started the process by calling myself and asking what the whole program was about. They said that I didn't qualify and that I had to have a refinance,' Whitney said.

Whitney is hoping to get her mortgage modified through funding for President Barack Obama's 'Making Home Affordable' program. Banks use federal bailout money for all the closing costs of refinancing and for the loss associated with lower interest rates.

'The borrowers are having terrible times getting approved for the loans because they never had enough money in the first place,' said real estate financial market expert Wade Ragas.

Life Center workers are the go-between. They negotiate with lenders to try and slash mortgage payments before homes end up in foreclosure.

'There were banks and other lending institutions that took bailout money to help refinance at no cost to the homeowner, to be able to make those homes affordable,' said Paul Smith, CEO of the Life Impact Center.

But even his non-profit is having problems getting certain lenders to cut borrowers a break.

'They would constantly send back things saying we want further clarification for this,' Smith said, delaying the process, often putting off adjustments to people's mortgages.

'I rushed in and put my paperwork through and that was a year and a half ago,' Whitney said.

Ragas said some of the major banks, which are now freezing foreclosures after cutting corners to rush them along, are hesitant to trust that the bail out money will offset their losses.

'I think they're afraid if they go through the process incorrectly, and then any help that the bank would've received, recovering part of the loss they don't get. I think they're afraid of that,' Ragas said.

It leaves borrowers with few options.

'It basically says if you owe more money than the house is worth, then there's an incentive to go through foreclosure. That's what's happening all over the country,' he said.

Experts say Louisiana is just now starting to feel the brunt of the recession, with foreclosures skyrocketing over the past year.

'St. Tammany Parish is the number one parish in the state of Louisiana on the home foreclosure list,' Smith said.

His group has more than 200 clients right now, all trying to hang on to their homes.

In St. Tammany, foreclosures represent one in every 365 homes. In New Orleans, it's one in 400.

On Saturday, October 9, the Life Impact Center in Mandeville is hosting a homeownership resource fair from 9 a.m. to 1 p.m. for those who are concerned about high house payments. For more information, call 985-845-0202.

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