is university professor at Rutgers-New Brunswick and public policy fellow at New Jersey Policy Perspective.

The foreclosure crisis is upon us. The media have treated it as an "urban" problem, something going on only in Philadelphia or Camden. Politicians in middle-class, suburban towns speak as if they believe their areas are largely immune to the ravages of foreclosures. They are wrong. The foreclosure wave is cresting quickly over the suburbs.

Nationally, as many as two million American families could lose their homes in the next year. They will fail to make their monthly mortgage payments, the sheriff will padlock their doors, and banks will repossess their homes. Adiós to their piece of the American Dream. Nationally, foreclosures soared 75 percent in 2007. This frightening trend continues today with no end in sight.

The impact of this deepening crisis is widespread. Neighbors of foreclosed houses are seeing their housing values plummet. After all, who wants to live on a street with five empty, boarded-up houses? According to the Center for Responsible Lending, 1.7 million Pennsylvania homes (and 1.8 million in New Jersey) will lose value because a neighbor has defaulted. Crime rises, as squatters break into abandoned homes and strip them of anything that they can sell - copper pipes, wire, and kitchen equipment. Schooling is disrupted for children when they have to move because their parents lose the house. Cities are losing tax revenue because of increasing numbers of vacant homes. This is ugly stuff.

Certainly, Philadelphia has a huge foreclosure problem: nearly 1,300 houses have been "pre-foreclosed" (the first stage of the process, when borrowers are 90 days late with their payments); 1,500 have been auctioned off, and nearly 2,200 have been taken over by banks. According to RealtyTrac, a mortgage data source, Camden homeowners are also deeply in debt; foreclosures there are high and rising.

But foreclosures are also quickly coming to the suburbs. Right now in Philadelphia's seven suburban counties, nearly 5,000 homes have been pre-foreclosed and 1,500 have been auctioned off, and banks took back 2,800 more homes.

Together, these add up to more troubled housing in the suburbs than in the region's two inner cities. Suburban towns such as Norristown (nearly 200 homes have been auctioned off or repossessed by lenders), Cherry Hill (151 pre-foreclosures, 71 repossessions), Pottstown, and others have large numbers of problem houses relative to their size.

There are many reasons foreclosures have hit so hard. Some dishonest mortgage brokers snookered borrowers into predatory loans; these loans were designed to fail because lenders - who walked away with fat commissions - knew that borrowers could not possibly make their payments. Other families, often minorities, were sold high-interest loans when they could have qualified for conventional and cheaper ones; some could not pay the high rates - usually at least three points above what others were paying - and lost their houses.

Financial-services gonzos invented dizzying arrays of exotic mortgages. They come with titles like "no docs" (no need to provide documentation of earnings or assets), "NINJA" loans ("no income, no job, and no assets" need be reported). Again, brokers made out as long as they could talk a family into taking out these risky loans, no matter how inappropriate they might be. Banks then sold their mortgages into large pools of securities, with no regard for what happened to the borrowers or to investors that bought these mortgage-backed securities. Rating agencies such as Moody's looked the other way, failing to protect investors.

Some families brought these problems on themselves by buying bigger and more expensive homes than they could afford. If they lost their jobs or got sick and didn't have insurance, they could no longer pay what they thought was an affordable mortgage. Good-bye, dream house.

Still others used their homes as ATMs: As housing prices rose during the early part of the decade, they took out second mortgages and used the proceeds to buy cars or finance their children's educations. When housing prices started to fall a couple of years ago, many houses became worth less than their mortgages. Faced with this, borrowers engaged in "jingle mail": they sent their keys back to lenders and walked away. Although it is hard to say precisely where they are going, they are probably down-sizing to rentals and moving in with relatives.

Sadly, federal and state regulators were asleep at the wheel and not protecting innocent borrowers. Former Fed Chairman Alan Greenspan and others saw regulation as a four-letter word. They said that the market would take care of these problems. It can't, and it didn't.

To be sure, the number of suburban foreclosures is less concentrated than Philadelphia's. And, it is important to understand, delinquent homeowners in the suburbs have a better chance of warding off foreclosures than their inner-city counterparts. Still, these numbers represent a new phenomenon that the state and its municipalities - suburban as well as urban - must begin to take seriously.

What can we do about this profound set of problems? At the federal level, legislation is in the works to provide money for counseling; to rework mortgages to make them more affordable; and to strengthen oversight of mortgage brokers. The Treasury Department has put together an alliance of servicers, bankers, and nonprofit organizations to try to work out some solutions on a voluntary basis. It is too soon to judge whether these measures will work, but the early signals are that these voluntary agreements are having very limited effects.

Legislation also has been introduced by Rep. Barney Frank (D., Mass.) and Sen. Christopher Dodd (D., Conn.) to guarantee and refinance loans that have been written down by lenders. The bill would try to refinance two million at-risk borrowers. These measures would also punish the scammers who perpetrated these mortgage schemes. This is a good approach, but it faces a veto by President Bush. It is too soon to judge whether these measures would work.

It is vital for public officials, community groups and mortgage companies to work together to identify owners with mortgage trouble and help them get through this quagmire before it is too late. Broad-based task forces of housing officials and community organizations are hard at work in San Diego, Newark, N.J., and elsewhere to come up with local fixes. In Philadelphia, the City Council has mandated a temporary delay in foreclosures. Also, a coalition of judges, housing counselors, and housing lawyers have put together a plan to ward off foreclosures by requiring mediation and delaying foreclosures for owner-occupied homes.

What is next for the region? If housing prices continue to fall, as many predict, the problem will get worse. Far worse. We need strong policies, or the specter of empty homes and lost tax revenues will spread even further.