“We are well beyond the point of this being simply a problem. The American dream of home ownership has turned into a nightmare for far too many Angelenos who find themselves face to face with foreclosure.” Alarcón’s motion came as J.D. Power and Associates released a study showing that lenders will work with homeowners in accommodating late payments, but are less understanding of these circumstances than a year ago. “Customers still feel as if their mortgage servicer is being less considerate of their specific circumstances,” said a statement by Tim Ryan, senior research director of finance and insurance at the Westlake Village-based company. “It is mutually beneficial for both borrower and lender to work through these difficult time periods, and lenders can support the majority of these customers by being even more considerate of their situation.” The mortgage market situation roiled Wall Street in recent weeks. DataQuick Information Systems reported last month that foreclosure activity had soared nearly 800percent in Los Angeles County and statewide. During the second quarter, 2,581 properties went into foreclosure, up from 287 a year earlier, the La Jolla-based company reported. Alarcón said most market watchers think the problem will get worse before it gets better, likely extending well into 2009. He also noted that the threat of foreclosure is looming over a variety of socioeconomic groups, not only those with bad credit or low income. The Housing Department will report within 30 days on creating the program, which would be financed by an allocation from the city’s Affordable Housing Trust Fund. Jack Kyser, vice president and chief economist at the Los Angeles County Economic Development Corp., said government-funded bailouts are gaining popularity, but he wondered how far the $5million would stretch. “It makes perfect sense, though. People were trying to buy their first house, and they badly stubbed their toe,” Kyser said. [email protected] (818) 713-3743160Want local news?Sign up for the Localist and stay informed Something went wrong. Please try again.subscribeCongratulations! You’re all set! Los Angeles City Councilman Richard Alarcón sought $5million in foreclosure assistance Wednesday for residents in danger of losing their homes as the housing market continues to unwind. Alarcón’s Emergency Foreclosure Assistance Program would be administered through the city’s Housing Department, providing loans and grants to residents threatened with foreclosure. The loans would likely average from about $5,000 to $10,000. “More people are losing their home today than were lost in the (1994 Northridge) Earthquake,” Alarcón said. “We responded to that emergency, and we need to respond to this one.” And $5 million is a reasonable amount to set aside for this program, he said.