If you were hoping that the mortgage crisis was nearing an end, you need to readjust your thinking. The Mortgage Bankers Association believes that mortgage originations will drop another 18% in 2008 and fall a bit more slowly, by just 6% in 2009, and it will say so in a forecast to be released today at its annual convention, according to today's Wall Street Journal [subscription required].

So unless something really significant happens between now and then to change the marketplace, don't expect to see an increase in mortgage originations until 2010. Yikes, that's a long time to wait, for people desperately needing to get out of a bad situation and avoid foreclosure. Home builders will need to ride out the storm for a much longer period too. Expect to see continuing bad news from the housing industry through at least next year.

Why do things look so bad? Investors are more risk-averse and are not providing the levels of cash lenders had become used to before the subprime crisis and the housing bubble burst. Doug Duncan, MBA's chief economist, told The Journal: "We have not yet seen fully the impact of the credit shock to the U.S. and world economies, and the severity of that impact will depend on how long it takes for the markets to return to normal functioning ..." More details will become clear in his speech today to the convention.

The MBA predicts total mortgages written will decline about 15% this year to $2.31 trillion from $2.73 trillion last year. Originations will fall a steeper 18% next year and then in 2009 we'll finally see a slowing of the fall to 6% in 2009. In 2009 as the market begins a turnaround, the MBA does expect mortgages for people buying homes will increase by 5%, but refinances will decrease by 18%. The MBA also expects to see some increase in homes sales and prices in 2009. We'll hit bottom in the third quarter of 2009, according to MBA predictions. Duncan told the Journal that "any significant increase in homebuilding is probably years off."

Lita Epstein is the author of more than 20 books including, "The 250 Questions You Should Ask to Avoid Foreclosure" and "Reading Financial Reports for Dummies."