DISTRICT HEIGHTS, Md.—Renee Brooks thought she had found her peace on Wild Rose Court.

Earning a decent salary as a welfare-to-work case manager, she landed a deal on a townhouse in a cul-de-sac on the outskirts of Washington. When she moved in with her young daughter in 2010, she simply felt relieved to be out of the noisy apartment complex down the road.

“You could hear everything, you could smell everything that people did,” says Brooks, 46, recalling her neighbors’ cigarette smoke wafting up into her old apartment. “Here, I don’t hear nobody talking. After nine, ten o’clock, you don’t hear a pin drop.”

Suddenly, in July 2013, Brooks lost her job. Six months later, Congress cut off her unemployment checks. Now she could lose her home, too. “When my unemployment stopped, I stopped paying my mortgage,” she says.

Brooks is now among the millions of unemployed homeowners who risk default, foreclosure, and huge debt loads—even if they manage to find a job again.

When Congress refusedto renew federal benefits for 1.7 million jobless Americans in December, they also cut a lifeline for homeowners who are now struggling to make their mortgage payments. About 54% of the long-term unemployed live in owner-occupied homes, according to Urban Institute researcher Austin Nichols—a total of 2.9 million Americans, according to the Current Population Survey. So the loss of income may cut off a crucial source of mortgage payments for these households.

That means many unemployed Americans and their families have even more to lose, without much of a backstop. A federal program that provided direct loans to unemployed homeowners has expired; many state-run programs have dispersed only a fraction of their funds. For many, the only option may be to buy themselves some more time—time that’s yielded few new opportunities for the long-term unemployed.

As a result, new defaults and foreclosures continue to be a drag on the recovery, even though the worst of the housing crisis has long since passed. While bad practices by mortgage companies still cast a shadow over many homeowners, advocates say there’s been a shift with the more recent cases that are starting to come through the system.

“Right now for the clients, this isn’t a problem with lenders—homeowners don’t have the income. The salaries are gone, the jobs are gone,” says Neal Conway, executive director of Community Legal Services of Prince George’s County in Maryland. “It’s not a matter of anyone doing anything wrong.”

New research has confirmed as much: Simply being unemployed makes default from 5% to 13% more likely, according to a 2013 paper from the Federal Reserve Bank of Atlanta.

Falling behind

Brooks never expected to fall behind on her brick-and-cream townhouse, tucked out of sight from the Dollar General and McDonald’s down the road. A single mother, she was earning $55,000 a year helping DC residents move from welfare to work.

It’s the first time in her adult life being unemployed, having worked in social services since she was 18 years old. Brooks started out as an administrative assistant at a men’s shelter, then worked her way up to becoming a case manager. She went back to school in her 30s to earn her Bachelor’s—“for the upward mobility,” she says—making her among the first in her family to graduate from college.

When Brooks could finally afford to buy her own home for $167,000, “I was ecstatic,” she says. “I finally had something I could call my own.” It was a short sale by a distressed homeowner who was “probably in the same predicament that I’m in [now],” Brooks says, with a laugh. She quickly got to work putting brick inlay behind the house, which she now likes to show off to visitors. “As you can see I’m trying to get it together little by little.”

Since Brooks lost her job last summer, she’s been relying heavily on her unemployment benefits to support herself and her 12-year-old daughter Denaisha. (“Her father—he helps when he can, but he has his own family,” says Brooks, who never married.) Between the $324 unemployment check and $105 in food stamps every week, she had just enough to stay afloat while she scoured job listings, reformatted her resume, and went out for interviews.

When her jobless benefits ended, Brooks got to work tracking down every lead that might help save her home. She managed to get a few weeks’ reprieve from her lender to avoid defaulting on her February payment for $1,250. But she’s had difficulty figuring out what her options even are.

She recalls going into one local agency where the woman opened up a big resource book. “She gave me five or six numbers. I went and called them numbers. When I called them numbers, I probably ended up with 20 different numbers until I got tired of calling,” Brooks says

“The biggest obstacle I hear from a lot of borrowers, they just don’t know where to go for help,” says Melanie Murray Mfume, a lawyer who does pro-bono housing work in the DC metro area. States like Maryland have invested millions in outreach and education programs, as have some mortgage companies. But too often, advice doesn’t reach troubled homeowners soon enough. “We get calls from people, ‘My house is being sold tomorrow, cash or keys,’” says Conway.

Brooks finally made it to a foreclosure workshop in late February, where more than a dozen distressed homeowners sat around a conference table upstairs from a food pantry—all African-American men and women living in Prince George’s County.

Linda Gantt, a pro-bono attorney for Community Legal Services, was leading the session. Her first piece of advice: Don’t be an ostrich.

“Everybody at some point in time will put their head in the sand. You just ignore it,” Gantt told the group. “If you have a stack of envelopes at home that you’ve never opened, go home and open them. “Who does that who gets them and doesn’t open them?” Hands went up around the room.

Brooks wants to stay on top of her own situation. “I’m trying to be proactive. So you can’t get upset because I’m ahead of my game,” she says. But the bank has been calling nonstop ever since she couldn’t make her February payment, then the March one, too. And it’s been wearing her down. “If I don’t have it, I don’t have it,” she says.

A temporary reprieve?

There may be some relief for unemployed homeowners if they manage to find it in time. But there have been serious problems getting help to homeowners who need it most.

Those with loans backed by Fannie Mae or Freddie Mac—who own or guarantee about 65% of all current mortgages—may receive a forbearance from their lender to suspend or lower their monthly payments; the same holds true for the 7.8 million loans backed by the Federal Housing Administration. In 2011-12, the Obama administration extended the maximum forbearance period from six to 12 months to give strapped homeowners more time to look for a job.

“Hopefully this is a temporary situation, and [forbearance] gives struggling homeowners some breathing room until they find employment. At that point, they may be eligible for a loan modification,” says Mark McArdle, chief of the Treasury Department’s Homeownership Preservation Office.

To qualify, homeowners have to prove they’ve been laid off and be no more than 12 months past due on their mortgage. Since 2009, about 108,000 have received a forbearance for their FHA-backed loan, according to Addie Whisenant, a spokesperson for the Department of Housing and Urban Development. There’s also a government forbearance program funded by the 2008-09 bank bailout called the Home Affordable Unemployment Program (UP). But its reach has been limited: Only 5,482 unemployed homeowners are currently participating in UP, the Treasury Department says.

Similarly, the bailout-funded Hardest Hit Fund was launched in early 2010 to aid homeowners in the states with the highest unemployment rates and steepest declines in housing prices. But the program has disbursed only 35% of its funds so far, helping just 162,000 individual homeowners as of last December—less than one-third of the total it was projected to help in 2011. (Some states have fared better than others: McArdle says that four states and DC have stopped accepting applications because they’ve fully committed all their Hardest Hit funds.) Another $1 billion program funded by the Dodd-Frank Wall Street overhaul gave direct loans to unemployed homeowners, but it has since expired.

While many more families have received loan modifications, jobless homeowners must have a current source of income to qualify. And the long-term unemployed are even less likely to have a second breadwinner to help with the mortgage: 44% never married, and 20% are widowed, divorced, or separated, according to a new paper from Princeton economists Alan Krueger, a former Obama adviser, Judd Cramer, and David Cho. As with predatory lending, long-term unemployment has also affected a disproportionately high number of African-Americans. A short sale or deed in lieu of foreclosure might soften the blow to their credit, but they would still lose their homes.

Forbearance, by itself, only offers so much relief: For too many long-term unemployed, even a year-long grace period won’t be enough time. Between 2008 and 2012, 11% of those who were long-term unemployed in any given month were working steadily at full-time jobs a year later, the Princeton economists found.

Laid off in March 2013, Brian Jones is now getting mortgage help from Keep Your Home California, which uses federal Hardest Hit Fund dollars to provide direct payment assistance. But the mortgage help ends this summer. And Jones, a former commercial loan officer for Wells Fargo, worries he’ll still be unemployed when that happens: In a full year of searching, the 50-year-old Oakland resident has only been called back for four interviews.

“When it ends in July, the panic starts to quadruple. I’ll either move it all out, rent it out, live with a friend,” says Jones, who also lost his federal unemployment benefits in January.

It pains Jones to think of losing the 1921 bungalow he spent years refurbishing, redoing the kitchen, the bathrooms, and the roof. He’s now combing through all his possessions to see what he could possibly sell on Craigslist or eBay. His motorcycle is the next to go.

Brooks has already cut back in every way she can think of: No Christmas presents, no cable TV, no McDonald’s, no trips to the dentist; a free school lunch for Denaisha. But it’s been difficult to budget with a growing 12-year-old in the house.

“It’s hard, because now she’s eating more,” says Brooks. “I might be able to fix a meal that lasts for two days. If I come back later, it’s gone. So, I just have to spend some extra money when I go to the grocery store.”

She tries to keep the stress hidden from her daughter, who keeps asking when she’s going to get a job. Brooks doesn’t tell her about all the employers who’ve turned her down, saying she earned too much money at her last job and would leave them for something better. But she’s already hit one breaking point. On the phone in a friend’s office in February, Brooks suddenly burst into tears as she explained for the umpteenth time that she was unemployed and having trouble making her mortgage payments. ”I don’t want to be set out,” she says.

Brooks can’t understand why Congress refuses to restore unemployment benefits that have now been cut off from more than 2 million Americans. Senate Republicans have blocked an extension for nearly three months, and the House GOP has already attacked the latest bipartisan compromise as “unworkable.”

“I know they were one vote away from passing [in February]. I don’t understand—you’re making people homeless and hungry,” Brooks says.

When asked whether she blames Republicans for blocking the bill, she simply replies: “At this point, I would not vote for none of ‘em again.”

The long shadow of unemployment

Even in the best-case scenario, unemployed homeowners could live under the shadow of their job loss and accumulated debts for years to come.

When borrowers receive forbearance, they are still on the hook for all their suspended payments when the grace period is over, regardless of whether or not they have a job. If they have found work or other significant source of income, they could try to negotiate with their lenders to receive a loan modification to reduce their monthly payments.

There’s no guarantee of that happening, however, particularly as abuses in loan servicing have proliferated even after federal regulators vowed to crack down.

Such prospects have added to the concerns of some housing analysts, who warn about the long-term impact of high joblessness. Even a decade later, workers who’ve experienced long spells of unemployment tend to have lower wages, earning 32% less than those who’ve been employed the whole time, according to a recent paper from the Federal Reserve Bank of Boston; they’re similarly less likely to own homes in the future. On average, researchers found, it will take the unemployed nearly 20 years to close the earnings and homeownership gap.

With assistance from a housing counselor, Brooks has recently applied for a loan modification. She’ll try for forbearance next. But if neither works out, Brooks worries about the options she will have left.

She’ll consider renting out one of her bedrooms, but that would mean a stranger living across the hall from her and her daughter. Selling the house would mean having to find a rental in an area where prices have been skyrocketing; she paid nearly as much to rent her old place as she owes in mortgage payments now. And she still can’t quite bring herself to accept the prospect that she’d have to leave her home. “I like this little townhouse,” she says.

But as job prospects remain grim for the long-term unemployed, more homeowners could be forced to make tough decisions about whether to fight to buy more time. Many don’t have any choice left at all.

“Nothing is sustainable without income. Some individuals they understand and accept that. They’re fine with letting the foreclosure process take a while and get to save their money they have, while they’re looking for a job,” says Owen Jarvis, a lawyer at St. Ambrose Housing Aid Center in Baltimore.

“Others—they don’t want to hear there are no options. But what can you do?”

Correction: Treasury’s Home Affordable Unemployment Program changed its rules in July 2011, eliminating a provision that disqualified homeowners who missed more than three consecutive payments. An earlier version of this story referred to the old rules.

Editor’s Note: This is the second of two stories about the foreclosure crisis that continues to haunt ordinary Americans years after the housing market hit bottom. You can read the first story about the families stuck in foreclosure limbo here.