Center for Responsible Lending)
That little blue line is the represents homeowners who've staved off foreclosure by reworking their mortgages.
This chart shows two things, really. First, we can see the scale on which struggling homeowners have managed to keep their homes by getting lenders to rework the mortgages. Second, we can see the scale on which the sheer number of struggling homeowners has risen. The strugglers are outpacing the rescued by a factor of seven.
The Center for Responsible Lending, which produced the chart, is calling on Congress to protect families. The advocacy wants the goverment to the most of the federal Making Home Affordable program, which launched with a goal of reaching 4 million families and has so far gotten only 200,000. Mortgage servicers met with the Obama administration today and promised to speed things up.
The Center is also asking Congress for legal changes that would allow bankruptcy judges to rewrite mortages on principal residences. It's lobbying for the Consumer Financial Protection Agency proposed by the Obama administration. The new agency has faced criticism from Federal Reserve Chair Ben Bernanke and FDIC chair Sheila Bair, some of whose current power would be subsumed by the new regulator.
Planet Money pal Felix Salmon notes an idea from the Center for Responsible Lending's director, Keith Ernst, for a mediation program to work out deals between mortgage services and lenders. Salmon writes:
I fear that Congress is beginning to get reform fatigue, after so many attempted solutions have failed. But that's no reason to stop trying new things — in fact, it's a good reason to try even harder.