Countrywide Financial, one of the nation's largest mortgage lenders, stopped foreclosure proceedings last year in hopes of modifying the loan for a small Escondido condominium after a national settlement with several states' attorneys general.

On the surface, it sounds like a success story in the wake of massive, multibillion-dollar efforts to stem foreclosures.

But there's one problem: The condo has been vacant for eight months.

Instead of success, this condo illustrates the difficulties lenders face in keeping track of thousands upon thousands of foreclosures and the frustration many borrowers experience when they try to save their homes.

The homeowner, Elba Coronado, received a notice of default -- the first step in foreclosure -- in June last year and moved out in August because she didn't want to go through the embarrassment of eviction. Since then, she has been renting a Vista apartment.

At some point, Countrywide halted the foreclosure process.

Coronado said Countrywide never told her she would be eligible for a modification of her loan. A Countrywide spokesman says Coronado never told them she had given up on the loan.

"I don't know, maybe they don't have my number," said Coronado, who added that she would like to move back into the condo but didn't think it was possible after being laid off from her second job in advertising sales.

Since she holds just one job, Coronado said the mortgage payment would need to come close to her rent payment of $845 per month. That's a tall order.

Even if Countrywide reduced the interest rate on her mortgage, which initially carried a balance of $275,000, to 2.5 percent -- the lowest level mentioned in the attorney general's settlement -- Coronado's payment would exceed $1,000 per month.

Plus, Coronado said she is late on her property taxes.

"It would be great if we could work something out between the taxes and the house payment, but I don't know how that can happen," she said.

Meanwhile, the condo sits vacant. Several analysts blame unoccupied homes for part of a downturn in prices because they attract squatters and vandalism.

Regional prices have already tumbled 41 percent from a 2005 peak.

Because Countrywide froze the foreclosure proceedings, Coronado technically still owns the property, not the lender.

"It raises the question of who maintains the property and who has responsibility for it," said Rick Simon, spokesman for Countrywide.

Even more mystifying is why Coronado's loan was selected for the modification process in the first place. California's attorney general joined forces with several other states to sue Countrywide for predatory lending in June 2008.

By October, the two parties had reached a settlement that the lender would modify 400,000 loans at a value of $8.68 billion.

But Coronado's modification has not reaped any benefits for her. Furthermore, it's part of a settlement for predatory lending by Countrywide, but the lender in no way preyed on Coronado.

Rather, Accredited Home Lenders, a subprime-focused bank, originated the loan, and Countrywide later acquired the rights to service the loan from a third-party investor, Simon said.

Simon said Coronado's loan was selected using an automated system that identified eligible loans.

Coronado has worked with San Marcos real estate agent Donna Steward to try and save the home. Steward said she was told by Countrywide to sell the property.

Such confusion and breakdown in communication is not the rarity, but the norm, said Steward, who regularly assists in loan modification requests for her clients.

"It doesn't surprise me because (the modifications) are all that way," Steward said. "They're all so buried with no help that the communication sucks."

And some analysts think lenders in general, not just Countrywide, have been sitting on foreclosure proceedings, waiting for a final answer out of the White House on the federal bailout programs.

Such delays could in turn slow recovery for the local housing market.

So again, Coronado's case represents the most common case, not the rarest, said Norm Miller, a professor with University of San Diego's Burnham-Moores Center for Real Estate.

"She's in no man's land, it sounds like," Miller said. "And that describes the market: Lenders say they're going to foreclose, and then stop and wait to see what the federal government does next."

Contact staff writer Zach Fox at (760) 740-5412 or zfox@nctimes.com. Read his blogs at bizblogs.nctimes.com.