U.S. Foreclosure Filings Rise by 5 Percent in February
Delaware recorded the highest foreclosure rate nationwide, followed by Illinois and Nevada.
According to the property data firm ATTOM, the number of foreclosure filings across the United States increased by 5 percent in February compared to the previous month, driven by persistently high mortgage rates.
“The rise in foreclosure filings in February reflects changing market dynamics,” remarked Rob Barber, CEO of ATTOM.
“Although some of the increase may be seasonal, the rise in foreclosure starts month-over-month and year-over-year hints at possible market shifts. We will keep monitoring the impact of economic factors on foreclosure trends moving forward.”
In February, one in every 4,395 housing units nationwide filed for foreclosure, with Delaware having the highest rate, followed by Illinois, Nevada, New Jersey, and South Carolina.
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High mortgage costs elevate monthly payments, which can push financially struggling homeowners towards foreclosure. This trend may continue throughout the year, as mortgage rates are not expected to decrease significantly in the near future.
In the previous month, Fannie Mae’s Home Purchase Sentiment Index dropped year-over-year for the first time in nearly two years, primarily due to waning optimism among consumers regarding mortgage rates.
“The drop in sentiment was further affected by consumers’ rising concerns regarding their personal financial situations.”
In February, Barber highlighted that interest rates, job market changes, inflation, and other market factors should be closely monitored to predict foreclosure trends this year.
Another potential indicator of increased foreclosures is the mortgage delinquency rate. Data from the Federal Reserve Bank of New York shows a rise in delinquencies among mortgage holders, which could lead to more property foreclosures.
In the fourth quarter of 2023, 0.82 percent of mortgage debt was classified as seriously delinquent, which then rose to 1.09 percent in the fourth quarter of 2024.
“The new law allows foreclosure sales in Illinois to be conducted online, in-person, or both, but the method must be clearly stated in the sale notice. Furthermore, the law establishes requirements for legitimate online sales, including acceptable fees, registration and identification criteria, and bidding procedures.”
