'08 Subprime Fallout: At Least 1.4M Foreclosures

Mortgage crisis slams economy across the board
By Jim O'Neill,  Newser User
Posted Nov 27, 2007 11:02 AM CST
Construction workers put the finishing touches on an interior frame at Saguaro Estates Toll Brothers luxury home development, Wednesday, May 23, 2007, in Scottsdale, Ariz. A new report says that subprime...   (Associated Press)
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(Newser) – The subprime mortgage fallout will continue through 2008, with 1.4 million Americans facing foreclosure, municipalities losing more than $6.6 billion in taxes, and housing values plummeting up to 16%, says a US Conference of Mayors report out today. The analysis projects slowed GDP growth and consumer spending and a rebound in 2009, the Journal reports.

US home values will drop by $1.2 trillion as prices decline 7% nationwide and the economy slows to a 1.9% growth rate, "a full percentage point lower than would have been the case without the mortgage crisis," the report says. Up to 450,000 loans will reset each quarter through 2008, USA Today reports, leading to “more and more homeless families.”