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SEATTLE - Twenty-two percent of homeowners in the Seattle area owe more on their homes than they're worth, according to a new Zillow study. And the threat of foreclosures continues to rise. Now state lawmakers are stepping in. Senate bill 6648 aims to give homeowners more of a say in which way the bank decides to go. But so far, it's been a tough sell in Olympia.

Melissa Huelsman works with homeowners who can't pay their mortgage anymore. She's helped draft a bill that aims to get everyone on the same page.

It's about the only tool that might work to make the people who own the loans and the homeowner get into the same room and figure out if they can negotiate something that's worthwhile for both of them, she said.

Charles Markland lost his job in August so he wanted to modify his home loan. Even though he was in foreclosure, his lender promised his house was not for sale. That all changed January 22.

I got a knock on my door around 4 in the afternoon saying they had sold my house, he said.

Why? Money.

In addition to being overwhelmed, loan services- the people hired to handle the loans -often find foreclosures are more lucrative than loan modifications.

Senate bill 6648 would create a formula comparing the two and determine what's best for everyone. If nothing changes, says Huelsman, they're going to continue to get worse because the more foreclosures you have in your neighborhood, the more it affects everybody else's property value in the neighborhood.

Markland now has one day left before he's supposed to be out of his house, a place he's called home for seven years and spent thousands on improvements. He intended to stay, had money from a pension fund and his 401K to help with the loan modification. He never got the chance.

If I had third party mediation, GMAC wouldn't have been able to lie to me, he said. I would've been able to reinstate my loan, but they lied to me.

Lenders are concerned people would sue if things go sideways with the mediation process. The bill died in the Ways and Means Committee. Its sponsor, Senator Adam Kline, is working to resurrect it.

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