Amy Gonzales, a home buyer who was struggling to pay her readjusted mortgage with Countrywide Financial Corp., turned to the San Diego Home Loan Counseling & Education Center, which is funded by the U.S Department of Housing and Urban Development. The center helped her secure a fixed-rate, interest-only payment for five years. By then she hopes the real estate market will have rebounded enough to allow her to refinance her loan, she says.

Jim Bliesner, with the San Diego Reinvestment Coalition, has also been working with lenders to avoid foreclosures.

” All the lenders we’ve talked to seem to be willing to go along with the program, but the primary obstacle is that 50 percent of their portfolio belongs to secondary investors, and the terms of the loans have been determined by those agreements, so their ability to rewrite those loans are constricted,” Bliesner says.

They are talking about San Diego but it’s probably the same story here in Phoenix.

” Right now, lenders are running for cover and concentrating on vanilla-type loans, lending to people with golden credit scores and a lot of money in the bank,” says T.J. Knowles, a mortgage broker with CalBrokers. ” They’re going back to that old cliche of saying, ‘If you don’t need a lot of money, I’d be happy to lend it to you.’ “

That sounds like a pretty accurate quote.