If you think progress is being made in the mortgage market, think again.  Through March, 1 in 11 American mortgages were past due or in foreclosure.  No matter how you look at it, these are not good numbers.  We haven’t seen numbers like this in 30 years, with the rate of new foreclosures and past-due payments surging to their highest level since 1979.  This is the bad news.  If you are wondering what the good news is, it appears little is in sight.  As of this writing, 8.8 percent of home loans were past due or in foreclosure.  That doesn’t sound like a lot, but if you look at the real numbers, it comes out to about 4.8 million loans.  Those figures are up from up from 7.9 percent at the end of December.

From where I sit, I can guarantee you that this number will continue to rise.  You only need to watch the evening news to know what kind of shape the economy is currently in to know that it isn’t getting any better.  Now, we see the airlines going belly up because of rising fuel costs, and each day it seems we see another airline retiring fleets of airplanes and cutting seats.  If you want to blame this on the sub prime market and the risky loans that were generated, then think again.  Now, we are seeing homeowners with better loans falling behind.

This will only get worse.  Job cuts are hitting where it hurts, and in the coming months could drive default rates much higher.  I defy anyone today to make mortgage payments and feed the kiddies on what unemployment pays.  It is just not doable.  Most people will be unable to put enough gas in the tank to get to the unemployment office.

The market is typical, with homes in California and Florida leading the race in dropouts.  In states like Michigan and Ohio, where jobs are being lost and manufacturing jobs are fast disappearing, people are facing the threat of not only foreclosure, but job loss as well.

The bottom line, for whatever it is worth, is that people cannot keep up with inflation at its current level.  People want to work, and pay their bills.  When confronted with $4 gas at the pump, and the price of food being reflected by everything from shipping costs to the price of fertilizer, I think the country would very much welcome a very realistic sea change.  Let’s see what happens…