By the US Gov's own estimation, there are some 2 MILLION...

By the US Gov's own estimation, there are some 2 MILLION homeloans from 2005-06 that are due to "reset" in the coming 12 months.

Given that they are resetting loans (ie taken because the owner could not afford or qualify for a 30 yr loan), one would have to assume that a large % of those will have significant problems meeting their new payments when their rate rises from 1 or 2% to 7-8% on reset (if they can find someone to accomodate them in the first place)!
The market knows this, & has done so for at least 12 months. That's why US real estate prices have been falling for 18 months odd (& not just sub-prime area prices ---- check out Orange County in California as an example of the effects on a 'high end' area).