Final answer:
Mortgage defaults were greatest in geographic markets that had experienced the greatest run-up in real estate prices.
Step-by-step explanation:
True. Mortgage defaults were greatest in geographic markets that had experienced the greatest run-up in real estate prices. When housing prices turned down, many households that had borrowed when prices were high found that what they owed the bank was more than what their home was worth. This led to an increase in mortgage defaults in areas with high real estate prices.