What Is Foreclosure Rate?
The foreclosure rate measures the percentage of mortgaged properties in some stage of foreclosure — from initial notice of default through bank repossession. Multiple organizations track this differently: ATTOM Data Solutions counts total foreclosure filings, the Mortgage Bankers Association tracks loans in active foreclosure, and CoreLogic measures the percentage of mortgages in foreclosure inventory.
Key Facts
- ATTOM reported foreclosure filings increasing approximately 32% year-over-year in Q1 2026, though the absolute level remains well below pre-pandemic norms
- The national foreclosure inventory rate is approximately 0.5% of outstanding mortgages — far below the 4.6% peak reached in late 2010 during the aftermath of the 2008 crisis
- Foreclosure filings reached 2.8 million annually at their 2010 peak, compared to roughly 350,000-400,000 annually in 2024-2025
- The pipeline ratio — foreclosure starts divided by completions — stood at 4.75 as of late 2025, meaning for every completed foreclosure, nearly 5 new ones are initiated, suggesting the process is backing up
- The ADI tracks foreclosure filings through its Debt Stress component, where rising filings contribute to the composite score alongside mortgage delinquency and credit card delinquency
Live Data
How Foreclosure Rates Are Calculated
The foreclosure rate is not a single number — different organizations measure different aspects of the foreclosure process:
- ATTOM (RealtyTrac) — Foreclosure filings: Counts all recorded documents related to foreclosure (notices of default, lis pendens, auction notices, bank repossessions). Reported monthly and quarterly as total filings and year-over-year change.
- MBA — Foreclosure inventory rate: Percentage of loans in active foreclosure at the end of each quarter, from the National Delinquency Survey. Covers roughly 88% of first-lien residential mortgages.
- CoreLogic — Foreclosure rate: Percentage of mortgages in foreclosure, from their national loan-level database.
Each metric captures a different slice: ATTOM measures flow (new filings), MBA and CoreLogic measure stock (current inventory). Both perspectives are important — rising filings can indicate worsening conditions even if the inventory rate appears stable (because completions are also rising).
Interpreting the Current Foreclosure Environment
The current foreclosure rate sits in a complex middle ground. Filings are rising from the artificially suppressed pandemic-era lows, when federal and state moratoriums halted most foreclosure activity for nearly two years. The year-over-year increase of roughly 32% reflects normalization from that suppressed base, not necessarily a crisis-level surge.
However, the pipeline ratio of 4.75 (starts to completions) warrants monitoring. When more foreclosures are initiated than completed, the inventory builds — either because courts are backlogged (in judicial states) or because servicers are pursuing loss mitigation before completing foreclosure. If the pipeline doesn't clear, it can create a delayed wave of completed foreclosures.
Foreclosure Rates and the ADI
The American Distress Index tracks foreclosure filings as part of its Debt Stress component. Rising foreclosure rates are a lagging confirmation of distress — by the time a foreclosure is filed, the homeowner has typically been delinquent for 3-6 months and loss mitigation efforts have failed. The ADI's leading indicator thesis suggests that savings rate erosion and delinquency trends predict foreclosure activity by 6-9 quarters.
The GFC backtest validates this: the ADI's composite score entered Elevated territory in 2007, well before foreclosure filings peaked in 2010. Foreclosure is the end of the distress pipeline, not the beginning.
State-by-State Variations
Foreclosure rates vary dramatically by state due to different foreclosure processes (judicial vs. non-judicial), processing timelines, and local economic conditions.
| State | Key Difference |
|---|---|
| New Jersey | Judicial-only state with among the longest foreclosure timelines (18-36 months). High foreclosure inventory rate because cases take years to process. Rate appears high partly because of slow clearing. |
| Florida | Judicial state with historically elevated foreclosure rates. The 2008 crisis hit Florida disproportionately hard, and the state led the nation in filings for several years. Current rates are normalizing but remain above national average. |
| Texas | Non-judicial state with fast foreclosure process (as quick as 41 days). Lower foreclosure inventory rate because cases complete quickly, but this speed also means distressed homeowners have less time to find alternatives. |
| California | Non-judicial state with strong anti-deficiency protections for purchase-money mortgages. Foreclosure rates are moderate despite high home prices, partly because the anti-deficiency law removes the deficiency judgment threat. |
| Illinois | Judicial state with 7-month post-sale redemption period. Chicago metro has higher foreclosure rates than the state average, driven by property tax burden and population loss in some neighborhoods. |
Frequently Asked Questions
What is the current national foreclosure rate?
The foreclosure inventory rate is approximately 0.5% of outstanding mortgages as of late 2025 — far below the 4.6% peak in 2010 but rising from pandemic-era lows. ATTOM reports foreclosure filings increasing roughly 32% year-over-year, reflecting normalization from moratorium-suppressed levels.
Are foreclosure rates increasing?
Year-over-year filings are increasing from the artificially low pandemic base when moratoriums halted most foreclosure activity. The absolute level remains well below pre-pandemic norms and far below crisis levels. The trend bears monitoring but doesn't currently indicate a 2008-style wave.
Which states have the highest foreclosure rates?
States with judicial foreclosure processes (New Jersey, New York, Illinois, Florida) tend to have higher inventory rates because cases take longer to process. Non-judicial states (Texas, Georgia) have lower inventory but faster completion. ATTOM's quarterly reports provide state-level filing data.
How long does a foreclosure take?
Timeline varies dramatically by state: 37-60 days in fast non-judicial states (Georgia, Texas, Wyoming) to 2-3 years in slow judicial states (New Jersey, New York). National average is approximately 9-12 months. Mandatory mediation programs in some states add time but improve outcomes.
How does the foreclosure rate connect to the American Distress Index?
The ADI tracks foreclosure filings through its Debt Stress component. Rising foreclosures contribute to the composite score but are a lagging indicator — they confirm distress that the ADI's leading indicators (savings rate erosion, early delinquency) detected 6-9 quarters earlier.