Data from the fourth quarter of 2009 show a continuing increase in home foreclosures in Maine, according to the Bureau of Financial Institutions. The numbers appear to be lower than they are in other states. And even as these figures show that some Mainers are struggling to keep up with their mortgage payments, there are also a couple of signs that are being welcomed by financial institutions.

First the bad news. Data obtained from 32 state-chartered banks and credit unions in Maine show an increase in foreclosures from October to December of last year.

"We did, again, see a modest increase in the number of homes in the process of foreclosure for the last quarter as well as those that have been foreclosed on," says Lloyd LaFountain, the superintendent of the Bureau of Financial Institutions.

His figures show that out of about 85,000 loans held by the state-chartered banks and credit unions, about 300 were in foreclosure in Maine. Put another way: Approximately one loan out of every 280 is in foreclosure.

The figures are not broken down by county, but LaFountain has some theories about why the numbers are up. "We find that the reasons why these numbers have increased are probably due to the economic times," he says. "We don't believe that these loans were in any way related to predatory lending. I think it's a combination of job losses, reduction in work hours and other economic considerations."

Chet Randall of Pine Tree Legal Assistance says most of his foreclosure cases involve national bank lenders or lenders owned by national banks or buyers on the secondary market, such as Countrywide, for example. Randall, who works with homeowners to try to prevent foreclosures, says most of the homeowners he deals with have loans that are at least a year old.

"And many of them face similar problems we've heard about in the past regarding sub-prime loans," he says. "We are seeing an uptick in the number of homeowners who have more traditional, conventional loans that may not have been sub-prime at the time of origination who are experiencing difficulty because of the loss of employment. That number is certainly rising but it's still not the majority of our cases yet."

Another possible snapshot of how Maine homeowners are faring is a look at the number of requests for sample foreclosure hardship letters on Pine Tree's Web site. These are letters homeowners write their lenders when they are falling behind in payments.

In 2008 there were 14,000 sample letters downloaded. Last year the number had more than doubled to 36,000. But Randall says one positive sign is that fewer people are coming through his door this year.

"We can't say exactly why it is. I think there's a fair assumption that can be made that it has something to do with the law," he says. "Or it could be that homeowners are trying to work harder and work more often with lenders before foreclosures are being filed."

Last year the Maine Legislature passed a law that established a foreclosure diversion program that offers mediation between lenders and homeowners. A pilot project begun in York County found that the strategy helped about half the people in foreclosure reach an agreement with their lenders.

Another sign that is being welcomed by Chris Pinkham of the Maine Association of Community Banks is that mortgage loans initiated during 2009 were up by 56 percent over 2008.

"And some praise should go to the Maine State Housing Authority for creating their Gift of Green Program," he says. "That complemented the federal tax credit that was provided and we're a little anxious in that those programs are winding down. but I do think that that has certainly helped people who were on the fence.""

Pinkham says not only did customers have an oportunity for a rebate, but they could also take advantage of some of the lowest interest rates in a long time.