Foreclosure filings are rising across the United States, according to new housing market data reported by ABC News, as homeowners contend with a stubborn mix of high mortgage rates, climbing insurance premiums, and rising property taxes. The increase marks a notable shift after several years of historically low foreclosure activity following pandemic-era protections.
Industry trackers that monitor default notices, scheduled auctions, and bank repossessions say the uptick is being felt in cities and rural counties alike, though the pace varies significantly by state. Housing analysts caution that while the numbers remain below the peaks seen during the 2008 financial crisis, the upward trend has persisted for several consecutive quarters.
What the Data Shows
Foreclosure filings include several stages: a lender’s initial notice of default, a scheduled foreclosure auction, and a bank repossession, known as real estate owned (REO). Analysts who compile this data from county records and public filings say all three categories have ticked upward in 2026 compared with the prior year.
Sun Belt states, which saw rapid home-price appreciation during the pandemic buying boom, are among those reporting some of the steepest year-over-year increases. Older industrial states in the Midwest and parts of the Northeast are also seeing filings rise, though from a smaller base.
“We’re essentially normalizing back toward pre-pandemic foreclosure activity, but the affordability backdrop is different this time,” one housing market analyst told ABC News, pointing to elevated borrowing costs and stretched household budgets as key drivers.
Why Homeowners Are Falling Behind
Several overlapping pressures are pushing more borrowers into delinquency:
- Elevated mortgage rates: Rates well above the ultra-low levels of 2020-2021 have made refinancing unattractive for many homeowners, leaving little room to lower monthly payments when finances tighten.
- Rising insurance costs: Homeowners in disaster-prone regions, including parts of Florida, California, and the Gulf Coast, have faced sharp jumps in premiums, with some insurers pulling out of markets entirely.
- Property tax increases: Local governments have raised assessments in many jurisdictions as home values climbed, adding to monthly housing costs even for owners with fixed-rate mortgages.
- Expired forbearance protections: Pandemic-era assistance programs that shielded millions of borrowers from foreclosure have wound down, exposing homeowners who were already on shaky financial footing.
- Job market softness: Layoffs in certain sectors, including tech and manufacturing, have left some borrowers unable to keep up with payments after income disruptions.
Consumer advocates note that many of the households now entering foreclosure are not necessarily subprime borrowers, but rather owners who bought or refinanced when rates were low and are now facing a combination of rising costs elsewhere in their budgets, including groceries, utilities, and childcare.
Regional Disparities
Not every part of the country is experiencing the same trend. Some Northeastern and West Coast metro areas with tighter housing supply have seen more modest increases, while faster-growing Sun Belt metros that saw heavy investor and first-time buyer activity during the pandemic are showing sharper spikes. Analysts point to overbuilding in some Southern markets, which has cooled home-price growth and left recent buyers with less equity cushion to fall back on if they miss payments.
The broader economic backdrop matters too. Regions tied to industries facing hiring slowdowns, including parts of the tech sector, have seen localized upticks in delinquency that mirror the employment concerns highlighted in recent reporting on data center construction and its uneven jobs impact.
What Homeowners Can Do
Housing counselors emphasize that foreclosure is rarely instantaneous, and homeowners who fall behind still have options if they act early. Federally backed loans, including those insured by the FHA, VA, and USDA, generally require lenders to explore loss-mitigation options, such as loan modifications or repayment plans, before initiating foreclosure.
“The biggest mistake we see is homeowners avoiding calls from their servicer,” said one nonprofit housing counselor familiar with the trend. “The earlier someone reaches out for help, the more options they typically have.”
The U.S. Department of Housing and Urban Development maintains a network of HUD-approved housing counseling agencies that offer free or low-cost guidance to borrowers at risk of default. Homeowners are also encouraged to contact their loan servicer directly to ask about hardship programs, which can include temporary payment reductions, loan term extensions, or deferrals of missed payments to the end of the loan.
What to Watch Next
Analysts say the trajectory of foreclosure activity through the rest of 2026 will likely hinge on whether mortgage rates ease, how insurance markets in high-risk states respond to continued premium pressure, and whether the broader labor market remains stable. If rates fall meaningfully, some strained borrowers could gain relief through refinancing; if they remain elevated, housing economists expect foreclosure filings to continue climbing gradually rather than spiking sharply, absent a broader economic downturn.
For now, the data points to a housing market recalibrating after years of pandemic-driven distortions, with millions of homeowners navigating a less forgiving financial environment than the one in which many bought their homes.
