I am including a link below that may be helpful for you. The practical story is that most homes that are foreclosed have a market value of less than the amount owed. This means that if I owned a home with a $700,000 mortgage, and it was worth $550K, and it was foreclosed, why would I redeem the property by paying more than it's worth, plus the late fees, penalties, and i interest?
Market values are driven by economic forces. Given the downward trend in values, the only time I can see this happening is if the property is worth more than the outstanding mortgage balance, plus penalties.