Moody"s Economy.com expects household credit conditions to continue weakening through much of the remainder of the decade, with another 5 million homeowners at significant risk of default during this period. This includes about one-half of the current 10.5 million borrowers with subprime (5.25 million), alt-A (4.5 million) or jumbo option ARM mortgages (.75 million) that are in significant negative equity positions.

Other types of consumer credit are also eroding, and problems will step up, according to Moody"s Economy.com. Credit card receivables are rising at close to a double-digit rate as homeowners unable to borrow against their homes are turning back to their cards as a source of cash. Card receivables are rising at close to 15% in California, 20% in Florida, and 30% in Nevada. Vehicle loans are also expected to suffer further erosion in loan quality through the remainder of the decade.

Mark Zandi will present Moody"s Economy.com"s findings on the health of household finances in a teleconference at 11 a.m. Eastern on Wednesday, July 23. The forecasts and analysis are based on exclusive data available through Equifax and house-price data from Case-Shiller® Home Price Indices from Fiserv Lending Solutions.

For more information visit www.economy.com or call 866.275.3266. *** Moody's Economy.com, a unit of Moody's Analytics, is a leading independent provider of economic, financial, country, and industry research designed to meet the diverse planning and information needs of businesses, governments, and professional investors worldwide. Moody's Economy.com information and services are used in a variety of ways, including strategic planning; product and sales forecasting; risk and sensitivity management; and as investment research.