The Federal Reserve today answered any lingering questions about how severely the housing slump is affecting average Americans: very severely.

For the first time since 2002, Americans' net worth declined in the fourth quarter of last year, the Fed said in its latest Flow of Funds report.

Perhaps more alarmingly, the Fed said that Americans on average owe more on their homes than they have invested in them. That is the first time that has ever happened since the central bank began tracking the number, in 1945.

The Fed statistics came on the same day that the Mortgage Bankers Association said that mortgage foreclosures rose to an all-time high at the end of 2007. Many borrowers with adjustable-rate loans walked away from their homes even before their payments increased, the industry group said.

"We're seeing people give up even before they get to the reset because they couldn't afford the home in the first place," Jay Brinkmann, the association's vice president of research and economics told Bloomberg News.

Loans entered the foreclosure process in the fourth quarter at the fastest pace since the industry group started tracking the figure, in 1985. The association said that 0.83 percent of all home loans slid into foreclosure in the last three months of 2007, compared with 0.54 percent a year earlier.

At the same time, the bankers group said, late payments rose to a 23-year high.