The rapid growth in the subprime and nontraditional mortgage market, combined with a slowdown in the appreciation of home values, may lead to increased foreclosures over the next few years. Nearly $ .5 trillion of adjustable rate mortgages (ARMs) will be eligible to reset during 2007, and between $500 billion to $800 billion will actually reset with new interest rates. Some analysts estimate that defaults from mortgage loans originated over the past few years using adjustable rates, introductory teaser rates, and payment options may lead to as many as . million foreclosures with losses approximating $ 2 billion, spread over the next six years or more.2 This Insights report reviews strategies that banks are using to prevent foreclosures to mitigate credit losses. The strategies presented in the report involve partnerships developed by banks, nonprofit organizations, state and local governments, and others who have a stake in keeping homeowners in their properties and maintaining the economic health of local communities. The information presented here was obtained from a variety of sources including financial institutions and nonprofit agencies.