How were these numbers calculated?
This number is based on the annualized rate of foreclosure starts reported in the 3Q 2008 MBA National Delinquency Survey, adjusted to reflect the entire mortgage market (the MBA survey covers 80%).
Why do these numbers matter?
Foreclosure starts from 2007-2008 more than doubled from those in 2005-2006. For the entire nation, foreclosures in 2009 are expected to reach 2.4 million. This epidemic of home losses has a devastating impact on working families, and by depressing the housing market and increasing unemployment, also weakens the entire economy.
What can we do?
To stop the downward spiral, policymakers must stop relying on voluntary actions by lenders. TARP funds should be used to reduce home losses and encourage more loan modifications. There's also another effective, tax-free way to stop foreclosures that industry is trying to block: allow homeowners to get loan modifications through the courts.