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ROBERT SIEGEL, host.

From NPR News, this is ALL THINGS CONSIDERED. I'm Robert Siegel.

MELISSA BLOCK, host.

And I'm Melissa Block.

There was more bad news about housing today. Sales of existing homes as opposed to new ones fell again in January. That's the sixth month in a row. The median price of those homes also fell to just over $200,000, and that's down more than 4 percent from a year ago.

SEIGEL: In an effort to hold down the rising number of foreclosures, lenders are reaching out to borrowers who are behind on their payments. The latest such meeting was in New York over the weekend. Several hundred homeowners showed up at a high school in the Bronx. They wanted to know if anything could be done to help them hang on to their homes.

NPR's Jim Zarroli was there.

JIM ZARROLI: One of the sad facts of the mortgage business is that a lot of people who end up losing their homes could have avoided it. Mortgage lenders insist they're willing to negotiate new payment plans with homeowners who fall behind on their mortgages. But they say delinquent borrowers can be hard to reach. They stop answering their mail; they won't come to the phone.

So not long ago, New York officials wrote to hundreds of delinquent borrowers and invited them to come to a high school in the Bronx neighborhood of Wakefield. All day long, borrowers filed into the school in a steady trickle and waited to talk to lenders.

Unidentified Woman: Twenty-three, 24. Are you 24? Okay, so you're next. And…

ZARROLI: They came with their children and elderly parents in tow carrying bank statements and mortgage documents. There was a sameness to the stories. Charmaine Brown is with the big mortgage reseller Fannie Mae.

Ms. CHARMAINE BROWN (Senior Business Manager, Fannie Mae): I've talked to people today who have said, my mortgage rate goes up and I don't know why. I just got a notice my payments are going up by $200 and I don't have the money. And I don't want to lose my home.

ZARROLI: That was the case with 69-year-old George Maschia(ph), who drives a tour bus for a living. This month, he says, his mortgage payment shot up from 2,400 to 3,600. And it could climb as high as 5,000.

Mr. GEORGE MASCHIA (Tour Bus Driver): A lot of money to work for. It would - I mean, right at that point, at that junction, you know what, here's my house and here's my keys. I'm not going to be able to do it.

ZARROLI: Maschia said he was going into the hospital for an operation. So he signed the mortgage documents without reading the fine print.

Mr. MASCHIA: I figured it would reset a little bit, you know, but then I finally sat down and really went through this thing. And I said, oh my God, what did I sign over here? I mean, I have to be a real birdbrain.

ZARROLI: There were a lot of stories like that, stories of confusion and bewilderment. One woman said her elderly parents had simply stopped reading their mail. And then realized too late that they were delinquent. Lenders insist they don't want to foreclose on people.

Natalie Abatemarco is with Citibank, one of 16 lenders who showed up on Saturday. She says the bank wants people to find a way to pay off their loans.

Ms. NATALIE ABATEMARCO (Director of Global Community Programs, Citigroup): If a borrower want - is in their home, they want to stay in their home and they have income, most lenders will absolutely work with that borrower to stay in their home. And at least that Citi's goal.

ZARROLI: That can mean sometimes helping them refinance. But it can also mean modifying their loan terms. That's what happened to Joyce Walker(ph). She had a home equity line of credit. The interests rate shot up, and she could no longer pay her bills.

Ms. JOYCE WALKER (Lender): I got to the point where I started selling things in my house to make the payments.

ZARROLI: What did you sell?

(Soundbite of laughter)

Ms. WALKER: I sold my televisions. I sold my TV. I sold some computers that I had - whatever I could come up with to make ends meet.

ZARROLI: But Walker walked away happy on Saturday. The bank agreed to lower her interest rate. For banks, the question of whether to cut rates is complicated. Most mortgages are converted into securities and sold to investors. When interest rates are cut, those investors lose money and that opens the banks up to lawsuits. But with Congress threatening to take action, lenders have been eager to prove they're good citizens. State Senator Jeff Klein, who helped organized Saturday's meeting, says he thinks banks have grown a lot more willing to negotiate with borrowers.

State Senator JEFF KLEIN (Democrat, Westchester/Bronx, New York): You know something, they weren't willing six months ago, but now they're willing, because I think they understand the problem that was caused by the subprime lending crisis.

ZARROLI: And that means there's some help available for the growing number of people drowning in mortgage debt, if they can only be persuaded to ask for it.

Jim Zarroli, NPR News, New York.

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