Financial crisis of 2007–2008
However, the housing companies built too many houses. This caused the price of housing to decrease beginning in the summer of 2006. The value of many homes dropped below the value of the remaining mortgage debt, so the owners were unable to sell and move away. This is called negative equity. About 8.8 million homeowners in the U.S. had zero or negative equity by March 2008. This caused the number of foreclosures on homes to increase, meaning that many people lost their homes. During 2007, almost 1.3 million U.S. homes began foreclosure proceedings. The number of houses for sale continued to increase, which made the prices decrease. The homeowners with subprime loans left their houses with less value than they had when they were bought, which meant that the loans were worth more money than the house. The loaning companies were not able to make money from these houses.