The number of mortgages that are in default is X% of the total number of mortgages (comments and data points are welcome here), but the US$ value of mortgages in default is a higher percentage than the number. In other words, higher dollar mortgages default more often than lower dollar mortgages. The number of people living in homes in which they are no longer paying a mortgage, property taxes, or insurance on is - I BELIEVE - a very significant number. There is no reliable data point for it. I am speaking from my own anecdotal experience. If I am correct, these people have experienced a windfall in disposable income. If my assertion is correct it would make sense that these people not be terribly interested in saving money that will be seized later in bankruptcy or in a lawsuit to recover unpaid mortgage debt.
Since the banks are not writing these debts off and marking to market BUT the mortgagor (borrower) IS... and is spending the money accordingly... this would be enormously stimulative in the short run... and a terrible precedent.
It would be reflected in the economic data as a no harm/no foul to the financials because they are not marking these losses to market, and the other side of all of this largess does reflect it in the form of increased spending and consumption.
Any data points or opinions would be appreciated.