We’ve seen the trend for some time.. increasing default notice combined with less likely possibility that someone in default gets out of it. I can’t imagine what things would look like in a year if defaults and foreclosures increase from here.

The good news is that these REO homes are helping the housing market rationalize much quicker than it would normally. But I think we will start seeing the add in reports from DQ saying how many home owners sold their homes for a loss which was a regular feature to the reports in the mid-90’s.

Hold on for more gang!  We haven’t hit the bottom just yet.