SAN FRANCISCO (CBS 5) -- While millions of homeowners continue to struggle with their mortgage payments, California is stepping in.

David Dixon has had a hard time paying his monthly mortgage. "It's worrisome, you can't sleep at night," he said. But Dixon is now getting a small break. A new state program for unemployed homeowners is reducing Dixon's mortgage payment from $3,700 to $700 a month for the next six months.

"All the worries I was having started to diminish because the fact that I saw stability for at least six months," Dixon said.

Steven Spears with the California Housing Finance Agency is in charge of overseeing four new programs intended to help California homeowners with hardships.

"It just throws a lifeline to all those people who have been told no or they have where to go," he said. Spears said homeowners who have fallen behind on their mortgage payment or can't stay in their homes and need money to relocate will be able to seek help.

But homeowner advocate Sheri Powers is skeptical about the principle reduction program that requires matching contributions from lenders. "On paper they are great programs," she said. "They look like they are going to help a lot of people, but in practicality I have my doubts."

Currently there are no lenders that have signed up for the principle reduction program. "We are approaching this program very cautiously," said Powers. "We caution them that again you can apply for the program, but if your servicer is not participating you're not eligible. The banks are still thinking about that."

If the four programs are successful, it is estimated that nearly 100,000 homeowners will benefit. "I like it," said Dixon. "For me it's great."

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