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Major Spike in Foreclosures in US: Reasons and Statistics

Foreclosures foreclosures

This article provides the latest statistics on foreclosures. There has been a major spike in foreclosure filings in the United States, but the reasons might surprise you. January of 2022 saw a huge spike in foreclosure starts, according to data solution ATTOM, which reported that 23,204 foreclosures were filed, an increase of 700% over the month of December of 2021 through January of 2022. Illinois had the highest rate of foreclosures among states in May 2022, at one foreclosure filing per every 2,000 housing units, according to data from ATTOM Data Solutions.

Foreclosures and US Housing Market!

The number of US housing units that went into foreclosure as of October 2022 was 32,376, according to experts from ATTOM Data Solutions. A total of 7,722 housing units facing potential foreclosure were taken off the market by seven owners across the country during Q4-2022, slightly higher than 7,707 during Q3-2022 and down from 7,432 during Q4-2021. A growing number of homeowners faced potential foreclosures after the national moratorium on lenders targeting delinquent homeowners that was in place following the coronavirus pandemic that struck in 2020 was lifted at the end of July 2021.

As a result of the moratorium’s protections, lenders couldn’t start foreclosures during the pandemics of 2020 and 2021. This led to the lowest number of foreclosure filings since this data has been tracked on a national level. In fact, many of those loans were protected under a moratorium that the government put in place during the pandemic, thus simply delaying the inevitable for a couple years. The explosion of home prices, which might look like a bubble years down the road, was not only due to the drop in mortgage rates, which fell as low as 3% on 30-year fixed-rate loans.

However, the market has started to cool significantly, due in large part to mortgage rates rising dramatically, and in some markets, demand has softened. Even with the modest increase in homes on the market, buyers are still facing high prices and mortgage rates in the 6% range. Rising rental prices and now higher mortgage rates, which jumped from averaging only 3.2% earlier this year to 5.71% in mid-June, are driving housing costs higher, pricing many out of the housing market.

Home prices rose much faster than incomes, creating a affordability squeeze, and mortgage rates have doubled since August 2021. Nadia Evangelou, a senior economist and forecasting director for the National Association of Realtors (NAR), said higher mortgage rates are expected to average about 5.7% in late 2022. Lawrence Yun, chief economist for the NAR, agreed there is no crash coming.

Housing economists have pointed out five strong reasons why a crash is not imminent. The wild dynamics of the housing market had Americans worried about a crash coming in 2008. California-based Attom Data Solutions, which tracks nationwide real estate and foreclosure data, recently released its U.S. foreclosure market report for August 2022.

IRVINE, Calif., Oct. 13, 2022–ATOM, the nation’s leading curator of real estate data on land and real estate, released its third quarterly report on the 2022 U.S. foreclosure market, showing that a total of 92,634 properties in the United States had filed foreclosure documents—default notices, scheduled auctions, or foreclosures by banks—up 3% compared to the prior quarter and up 104% from a year ago. 

According to the midyear U.S. foreclosure market report from real estate data analytics company ATTOM Data Solutions, the number of foreclosure starts at the time when the first public foreclosure notice occurs is up 219 percent since the beginning of the year. The states with the highest numbers of foreclosure starts in Q3 2022 included California (7,368 foreclosure starts); Florida (6,671 foreclosure starts); Texas (6,217 foreclosure starts); Illinois (4,702 foreclosure starts); and New York (3,997 foreclosure starts).

Of all 50 states, California had the largest number of foreclosure starts (3,942), while Vermont had the least (7). When it came to foreclosure starts, California led the way, followed by Florida, Tennessee, Illinois, and Ohio. The states with the longest median timelines to foreclose on homes in the third quarter of 2022 were Hawaii 2,121 days, New Jersey 2,002 days, Louisiana 1,963 days, Kansas 1,848 days, and New York 1,808 days.

States with the shortest average foreclosure timelines for homes foreclosed in Q3 2022 were Minnesota 113 days, Mississippi 167 days, Texas 168 days, Nebraska 168 days, and Missouri 172 days. New Jersey followed, with 1 in every 2,346 homes in some stage of foreclosure. With 739,072 housing units in all, the Mount Rushmore state has seen 145 foreclosures, resulting in a one-in-five 97-home foreclosure rate.

Of its 2,923,175 housing units, 939 homes were foreclosed in October. Despite growth, the number of zombie properties remains historically small, representing just a small fraction of the overall U.S. stock of 100.1 million housing units. Because of the de-eminent domain problem and shrinking pool of households who are qualified for mortgages, the fact that 1.5% of all housing units are foreclosed upon has more impact on housing prices than if 1.5% of households were to suddenly sell their homes and purchase other homes.

Right now, there is no reason to think foreclosure starts are going to skyrocket, given the low 3.3% nationwide default rate through January 2022. That is still among the lowest rates in America, ranking Arkansas No.

When the economy crashed, banks were unwilling to make loans at all.  Federal support of the mortgage market meant borrowers could choose better loan products for example, the 30-year fixed-rate mortgage, which is a global first, was made possible by the heavy Federal support for American mortgage markets.  

These Federal entities also ensured mortgages were available in difficult economic times, when the private market closed its doors entirely to consumers. When the economy crashed, banks were not willing to lend at all.  

If you have been considering Buying, Selling, or Renting your home or have avoided the notion due to a negative experience, let Arsh Syed, a Real Estate Agent in Toronto, manage the transaction.

His experience and understanding have been indispensable. He desires Toronto’s housing crisis to improve. He wants to establish relationships and spread the word about his exceptional service, increasing the likelihood that renters and property owners would place their faith in him.

Arsh wants property owners to know that by hiring him, they are drastically reducing risks, saving time, and saving money.

For further information about his services, please visit or contact (416) 844-2217


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