Now Youngblood, behind on payments and out of rebuilding money, said she may lose her Lower 9th Ward home. The floods couldn't keep her from her house, but higher payments might.

"It's too much," Youngblood, 53, said. "My mortgage was the last thing I was thinking about."

Homeowners trying to rebuild from the floods of 2005 are increasingly facing a new adversary: foreclosures. As housing repair bills mount, so does the pressure to make their primary housing payments.

Foreclosures have hit nearly every pocket of the U.S. hard, so mortgage problems are everywhere. But they've hit particularly hard here because so many Gulf Coast residents have set aside so much of their incomes and financial aid for repairs made necessary after Hurricane Katrina.

Self-imposed moratoriums on mortgage payments by banks in Louisiana and Mississippi expired last year, and there are fewer sources to turn to for aid.

For instance, residents who applied for federal housing grants, such as the Road Home program in Louisiana, may not qualify if they receive a foreclosure notice.

Those who have already received a grant risk losing it if they forfeit their home, said Mark Moreau of the New Orleans Legal Assistance Center, which offers legal advice.

The Road Home program has allocated more than $7 billion for Gulf Coast storm victims who are trying to rebuild their homes.

"We think as time goes on the problem is only going to increase," Moreau said.

Youngblood, whose two-bedroom home in the Lower 9th Ward was battered by Katrina, received $104,000 in Road Home money in 2006, all of which went for repairs, she said. Her lender excused her mortgage payments for two years after the storm, but in August they asked for $10,000 toward the missed payments.

A contractor working on the home disappeared with a deposit she had given, she said. Then, last year, the monthly payments on her adjustable rate mortgage jumped from $620 before the storm to $838, well beyond her means, she said.

If Youngblood loses her home within three years of receiving the Road Home grant, she may be forced to return the money.

"I've worked hard all my life for what I have," said Youngblood, a seamstress. "I paid my bills my whole life. But when Katrina came, it messed everything up."

Louisiana and Mississippi were initially not hit as hard by the mortgage crisis as other states because homes there were not particularly overvalued, said Sal Bernadas of the Louisiana Mortgage Lenders Association. In February, for example, there were 650 foreclosures in Louisiana and 148 in Mississippi, compared with more than 12,000 in Texas for the same month, according to RealtyTrac, an online service that tracks foreclosures.

Many lenders offered the moratoriums on mortgage payments immediately after the storm. When those expired last fall, many homeowners found themselves with ballooning debts and higher payments.

Faced with the threat of foreclosure, many residents are using their rebuilding money to pay mortgages, which could slow the pace of the city's revitalization, said Bruce Dorpalen of ACORN Housing in New Orleans, which offers housing counseling.

"You can't really rebuild if all your money is going to pay off back debt," he said.

Dorpalen said his group has been lobbying mortgage lenders, such as Freddie Mac and Chase Bank, to lower interest rates and fix adjustable mortgage rates for residents in disaster-struck areas. Many of the lenders have been cooperative, he said.

"We're seeing a pretty steady stream of foreclosure issues," Dorpalen said.

Foreclosure cases have also been piling up at the Mississippi Center for Justice, a non-profit group that offers legal counseling, said John Jopling, a senior attorney there.

The center has successfully negotiated with many lenders to forestall foreclosures until applicants receive their grant money, Jopling said.

Lenders in Mississippi have been cooperative in working with homeowners to avoid foreclosures, said Lee Youngblood, a spokesman with the Mississippi Development Authority, which administers the housing grants.

Lanita Johnson, 47, refinanced her home in Hammond, La., in 2006 to start repairs on her storm-ravaged home while she waited for Road Home money. Since then, her mortgage payments have climbed from $789 to $1,889 a month, she said.

She'll use part of the Road Home money to stave off foreclosure, she said. Beyond that, she said she doesn't know how she'll make the payments.

"I never imagined this would be a problem," she said.

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