Lenders began foreclosure proceedings on nearly 60,000 Californians in August alone. The consequences of these growing foreclosures are being felt by families who have lost their main asset and residence, neighborhoods that suffer lower property values, local governments that incur increasing costs and decreasing tax revenue, and the broader California economy which is heavily dependent on the housing market. Yet a key question remains -- is foreclosure the only option? Approximately two million loans are facing rising interest rate resets in the U.S. over the next two years, and many borrowers will be unable to meet their increased mortgage payment. Over 500,000 Californians may be at risk of foreclosure. For many of these borrowers, perhaps the best they can hope for is that they will be able to negotiate with their loan servicer for a loan modification, which would make the terms of the loan more affordable to them. The good news is that servicers routinely say they want to negotiate loan modifications and keep borrowers in their homes. The bad news is that anecdotes and data suggest that these loan modifications are not really occurring. CRC surveyed 33 of the roughly 80 mortgage counseling agencies across the state which are certified by the U.S. Department of Housing and Urban Development to assist borrowers at risk of foreclosure. Mortgage counseling agencies are often the only place for borrowers to turn when they are faced with foreclosure. Counselors help borrowers understand their options and often act as intermediaries between borrowers and their lenders. The groups that responded to this CRC survey served approximately 9,800 consumers, including nearly 3,800 consumers through in-person meetings, in the month of August alone. Sadly, they reported that the most common outcomes for these borrowers were foreclosures and short sales, both of which result in home loss. The body of the report includes key findings, as well as recommendations for lenders and policy makers