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Foreclosure Report: Which States Are Seeing Increases?

ATTOM Data Solutions this week released its July 2020 U.S. Foreclosure Market Report, which shows there were a total of 8,892 U.S. properties with foreclosure filings — default notices, scheduled auctions or bank repossessions — in July 2020, down 4% from a month ago and 83% from a year ago.

“Even as mortgage delinquency rates climb, foreclosure activity continues to be artificially low due to moratoria put in place by the Federal and State governments,” said Rick Sharga, EVP at RealtyTrac (an offspring of ATTOM). “It’s inevitable that there will be a significant increase in foreclosures once these moratoria have expired, although it’s unlikely that we’ll see default rates reach the levels we saw during the Great Recession.”

Delaware, South Carolina, Maine post highest state foreclosure rates, according to the report, which included the following details:

"Nationwide one in every 15,337 housing units had a foreclosure filing in July 2020. States with the highest foreclosure rates were Delaware (one in every 6,489 housing units with a foreclosure filing); South Carolina (one in every 7,328 housing units); Maine (one in every 7,542 housing units); New Mexico (one in every 8,255 housing units); and California (one in every 9,194 housing units).

Among the 220 metropolitan statistical areas with a population of at least 200,000, those with the highest foreclosure rates in July 2020 were Trenton, NJ (one in every 3,445 housing units with a foreclosure filing); McAllen, TX (one in every 3,833 housing units); Davenport, IA (one in every 4,038 housing units); Dayton, OH (one in every 4,055 housing units); and Albuquerque, NM (one in every 4,452 housing units).

Those metropolitan areas with a population greater than 1 million, with the worst foreclosure rates in July 2020 included Louisville, KY (one in every 5,383 housing units); Riverside, CA (one in every 7,345 housing units); Baltimore, MD (one in every 8,139 housing units); Cincinnati, OH (one in every 8,289 housing units); and St. Louis, MO (one in every 8,514 housing units).

Nationwide, foreclosure starts are down. A total of 4,530 U.S. properties started the foreclosure process in July, 7% less than last month and 83% from a year ago."

Counter to the national trend, several states posted month-over-month increases in foreclosure starts, including Connecticut (up 54%); Michigan (up 42%); Missouri (up 34%); Virginia (up 32%); and California (up 1%).

Among metropolitan areas with a population greater than 1 million, those with the greatest number of foreclosure starts in July 2020 were Los Angeles, CA (285 foreclosure starts); New York, NY (190 foreclosure starts); Chicago, IL (182 foreclosure starts); Houston, TX (174 foreclosure starts); and Atlanta, GA (125 foreclosure starts).

Bank repossessions continue to drop to lowest levels. Lenders foreclosed (REO) on a total of 2,163 U.S. properties in July 2020, down 14% from last month and 80% from a year ago to the lowest since we began tracking in 2005.

“Even after default activity starts to increase, we may not see a similar increase in the number of repossessions,” Sharga noted. “The combination of record levels of homeowner equity, extremely limited supply of homes for sale, and strong homebuyer demand should give many distressed homeowners an opportunity to sell their property rather than lose it to foreclosure.”

About Author: Christina Hughes Babb

Christina Hughes Babb is a reporter for DS News and MReport. A graduate of Southern Methodist University, she has been a reporter, editor, and publisher in the Dallas area for more than 15 years. During her 10 years at Advocate Media and Dallas Magazine, she published thousands of articles covering local politics, real estate, development, crime, the arts, entertainment, and human interest, among other topics. She has won two national Mayborn School of Journalism Ten Spurs awards for nonfiction, and has penned pieces for Texas Monthly, Salon.com, Dallas Observer, Edible, and the Dallas Morning News, among others. Contact Christina at christina.hughesbabb@thefivestar.com.
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