The biggest recent change to Keep Your Home California was deemed an "aggressive, out-of-the-box idea that yielded positive results" by Claudia Cappio, executive director of the California Housing Agency, which oversees the program.

The change was made in order to increase accessibility to the program for struggling homeowners and involves KYHC officials eliminating the dollar-for-dollar match for servicers, and taking on the full financial responsibility of the principal reduction, writes Cappio in a Treasury blog post.

The change plays out like this: mortgage servicers need to approve the principal reduction application before they modify or recast the loan with the new principal amount, creating a more affordable and sustainable mortgage for the homeowner.

According to Cappio, the results have been astounding. "Keep Your Home California now has almost 60 mortgage servicers participating in the Principal Reduction Program, including Bank of America, JPMorgan Chase and Wells Fargo," she writes.

Cappio says more servicers on board means more homeowners are now applying and being approved for the program – a 47% increase in fourth-quarter 2012 compared to one-year prior.