Foreclosure Starts Up, More Consumers Report Feeling Worried About Losing Homes

Foreclosure starts are back to pre-pandemic rates.

According to ATTOM, foreclosure filings in August reached 34,501 properties, including default notices, scheduled auctions or bank repossessions. This is an increase of 14% from July and up 118% from August 2021. Lenders reported starting the process for 23,952 properties, an increase of 12% from July and 187% from August 2021. Across the country, one in every 4,072 properties had foreclosure filing in August. (As a reminder, there was a nationwide eviction moratorium through August 2021.)

August 2022 foreclosure filings were 86% of August 2019 levels, but the report noted that 2019 levels were lower than average during that time.

Pennsylvania had one of the highest number of completed foreclosures repossessed by lenders at 260. Across the U.S., lenders repossessed nearly 4,000 properties via completed foreclosures, an increase of 28% from July and up 59% from August 2021. Specifically, Philadelphia saw a jump in REOs, rising 28% from July.

“Repossessions are likely to continue running below pre-pandemic levels for several reasons, most importantly that over 90 percent of borrowers in foreclosure have positive equity in their homes, and would benefit from selling these properties at a profit rather than risk losing everything to a foreclosure auction or lender repossession,” said Rick Sharga, executive vice president of market intelligence at ATTOM.

As foreclosure starts continue to rise, so do consumers’ fears of foreclosure, according to a recent survey from Quote Wizard. Seven percent of Americans reported they are concerned they may face foreclosure soon, while 4% said they are behind on their mortgage payments. In Pennsylvania, 18% of residents believe they are facing foreclosure and 7% reported being behind on mortgage payments.