This summer there’s some good news. June foreclosure activity has dropped to its lowest level since November 2015. In June 2017, there were a total of 73,828 U.S. properties with a foreclosure filing, down 22% from a year ago and even more from previous years.
This is all according to ATTOM Data Solutions, curator of the nation’s largest multi-sourced property database, which released its Midyear 2017 U.S. Foreclosure Market Report, showing a total of 428,400 U.S. properties with foreclosure filings. This includes default notices, scheduled auctions or bank repossessions that occurred in the first six months of 2017. Data has been collected from more than 2,200 counties nationwide, with those counties accounting for more than 90% of the U.S. population.
Although the study is full of foreclosures, they’ve become fairly rare in the housing market.
“With a few local market exceptions, foreclosures have become the unicorns of the housing market: hard to find but highly sought after,” said Daren Blomquist, senior vice president with ATTOM Data Solutions.
As homeowners stay on top of their mortgages and housing payments, fewer foreclosures have been occurring. (If you’ve been faced with foreclosure, you’ll likely see the damage to your credit score. Not sure? You can see two of your credit scores for free on Credit.com).
Here are the ten states with the highest foreclosure rates as of June 2017.
10. New Mexico
June 2017 Foreclosure Rate: 1 in every 272 housing units
Change from January to June 2016: Down 10.57%
Change from January to June 2015: Up 1.77%
June 2017 Foreclosure Rate: 1 in every 229 housing units
Change from January to June 2016: Down 18.49%
Change from January to June 2015: Down 24.33%
8. South Carolina
June 2017 Foreclosure Rate: 1 in every 221 housing units
Change from January to June 2016: Down 15.05%
Change from January to June 2015: Down 14.31%
June 2017 Foreclosure Rate: 1 in every 217 housing units
Change from January to June 2016: Down 33.60%
Change from January to June 2015: Down 56%
June 2017 Foreclosure Rate: 1 in every 215 housing units
Change from January to June 2016: Down 30.59%
Change from January to June 2015: Down 40.45%
June 2017 Foreclosure Rate: 1 in every 200 housing units
Change from January to June 2016: Up 3.19%
Change from January to June 2015: Up 44.75%
June 2017 Foreclosure Rate: 1 in every 183 housing units
Change from January to June 2016: Down 10.19%
Change from January to June 2015: Down 25.78%
June 2017 Foreclosure Rate: 1 in every 161 housing units
Change from January to June 2016: Down 30.62%
Change from January to June 2015: Down 31.55%
June 2017 Foreclosure Rate: 1 in every 137 housing units
Change from January to June 2016: Down 6.48%
Change from January to June 2015: Up 20.42%
1. New Jersey
June 2017 Foreclosure Rate: 1 in every 101 housing units
When Lageshia Moore and her husband found their home in 2006, they thought it would be a perfect place to raise their family. The $549,000 Far Rockaway, N.Y., duplex even had future income potential if they could find a reliable tenant and rent out one half of the house.
In order to purchase the property and avoid primary mortgage insurance, the couple took out two mortgages to cover the costs.
Like millions of Americans who purchased homes at the peak of the housing bubble, their timing could not have been worse. Moore, a teacher, left her job in 2007. It soon became impossible to meet their $4,000 total monthly mortgage payments. By the summer of 2008, they were deep in default, and the recession sent their home value plummeting.
They were officially underwater on their house, and the family was living solely on Moore’s husband’s income as a driver. Eventually, they were notified that their lenders had begun the foreclosure process.
“Some people might say, ‘OK, just get a new house.’ But it wasn’t that simple,” Moore said. “This was the house where we were raising our family. My husband is very proud and homeownership means a lot to him — so we weren’t going to just let it go.”
Instead, Moore and her husband did what many families facing foreclosure do: They began looking desperately for “foreclosure relief” companies, law firms, and groups who promised help. A nonprofit connected them to a court-appointed attorney, but it didn’t stop the foreclosure process. So they turned to companies that advertised foreclosure relief on radio stations and online.
Over the course of six years, the family handed over thousands to a handful of relief groups they thought could stop the foreclosure. “We were desperate, and we thought, ‘OK, we’ll hand over this money to someone and they’ll just fix it,’” Moore said.
One of those foreclosure relief companies was Florida-based Homeowners Helpline, LLC. In 2015 the family gave the company a total of $6,000: an initial $2,000 down payment, and then $1,000 in four monthly installments. By that time Moore had found a new job, but the family hadn’t paid the full mortgage amount in years.
Moore shared the contract with MagnifyMoney, in which Homeowners Helpline says it will “perform a mortgage loan review and audit,” including actions like sending a cease-and-desist letter and a “Qualified Written Request” for information about the account to the family’s lenders.
Here’s what Moore says happened: Homeowners Helpline connected her family with a New York City lawyer who “kept asking for endless paperwork, month after month after month,” and who eventually stopped answering their calls, she claims. They finally got in touch with him just before the house was set to go up for auction, she said, and he told them the efforts to stop the auction had failed.
“We were horrified,” Moore said.
Homeowners Helpline told MagnifyMoney a different story. Sharon Valentine, a processor at Homeowners Helpline who worked on Moore’s husband’s case, said the family was slow to hand over needed paperwork and “unrealistic about their expectations.”
Crucially, Valentine said, the family didn’t tell Homeowners Helpline the house was actively in foreclosure until they mentioned the auction. “And then it was like, ‘Wait, what?’” Valentine said. The company would have taken different actions had they known about the foreclosure proceedings, she added.
“We can’t help you effectively if you don’t give us all of the information and the paperwork,” Valentine said. “In general, some clients come in and they hear their friend was able to get a 2% [mortgage] rate or cut their payments in half, and it’s like, ‘Well, that’s a very different situation.’ We try to help educate, but sometimes you can’t change that expectation.”
The Best Help is Free
But there is a free resource to educate panicked homeowners about expectations and provide foreclosure assistance — as well as help them avoid scam companies that will steal their money. NeighborWorks America runs LoanScamAlert.org, which aims to be a one-stop shop for people with questions about or problems with their mortgages.
The Loan Modification Scam Alert Campaign launched in 2009, when Congress asked NeighborWorks America to educate and help homeowners. LoanScamAlert.org offers resources including information about how to spot and report scams, and lists of trusted authorities who can help. Its main goal: Drive people to call the Homeowner’s HOPE Hotline, at 888-995-HOPE (4673), which is staffed 24 hours a day by counselors who work at agencies approved by the U.S. Department of Housing and Urban Development (HUD).
“We provide them with a single, trusted resource,” said Barbara Floyd Jones, senior manager of national homeownership programs at NeighborWorks America. “It gets confusing when you see companies with all of these similar names advertising on the radio or TV, and then you have to research them. We want to let people know they don’t have to pay a penny for assistance.”
Anyone — regardless of income or other factors — can contact the counselor network to receive free advice and help. Homeowners aren’t always aware of the myriad government-affiliated groups that can provide assistance, or of the federal and state programs created to speed loan refinances and modifications, Floyd Jones said.
“We can never promise that everyone will be able to save their home; there are a variety of circumstances,” Floyd Jones said. “But we can promise a trusted counselor will listen, take a look at your paperwork if you want, and tell you all of your options.”
In fact, if a homeowner grants permission, the counselor can contact the mortgage lender directly to discuss options to stop the foreclosure, modify the terms of the loan, or otherwise make a deal. If need be, homeowners will also be connected with vetted legal assistance — although Floyd Jones noted not every situation requires a lawyer.
True to LoanScamAlert.org’s name, the hotline counselors also take complaints about mortgage-related scams: third-party companies that take the money and run, or slip in paperwork that unwittingly gets homeowners to sign over the deed to the house.
The Federal Trade Commission received nearly 7,700 complaints about “Mortgage Foreclosure Relief and Debt Management” services in 2016 — down from almost 13,000 in 2014, but still a significant figure.
“Stopping phony mortgage relief operations continues to be a priority” for the FTC, said spokesman Frank Dorman.
Both the FTC and LoanScamAlert.org offer tips to avoid scams — and to make sure you’re taking advantage of all federal and state programs that could help.
They ask you to pay before any services are rendered.
Pressure to pay a fee before action is taken, sign confusing paperwork, or hire a lawyer off the bat. As with any scam, fraudulent mortgage relief services rely on high pressure to push vulnerable homeowners into taking action. Companies shouldn’t ask for “processing fees” or “service fees” early in the process, Floyd Jones said, as early foreclosure-stoppage efforts don’t cost anything. Be wary of signing any document, as you could unwittingly surrender the home’s title or deed to a scammer.
They make promises they can’t keep.
Promises or guarantees they’ll save your home from foreclosure — or even claims like “97% success rate!” No one can guarantee results.
They say they’re affiliated with the U.S. government.
Companies that claim to have an affiliation with a government agency. Some scammers may claim to be associated with the government, charging fees to get you “qualified” for government mortgage modification programs like Hardest Hit Fund. You don’t have to pay for these government programs — and lenders, particularly big banks like Wells Fargo and Bank of America, may be able to offer you their own modification options directly.
They want you to send your mortgage payments to them.
Companies that tell you to start paying your mortgage directly to them, rather than your lender. They may promise to pass the money along, but they could pocket it and disappear.
Companies that ask you to pay them through unconventional methods: Western Union/wire transfers, prepaid Visa cards, etc., instead of a check. They’re trying to get your money in a way that’s hard to trace.
As for Lageshia Moore and her husband, the family ultimately filed for bankruptcy — a move that can stop the foreclosure process, but only temporarily — and are now working with a law firm on a loan modification she hopes will reduce their payments to a manageable monthly sum. In giving advice to others, she reiterates the simplest but most important tip: “Just do your research.”
“You’re panicked, but you have to do your due diligence,” she added. “Really sit down and weigh the pros and cons: foreclosure, short sale, etc. What does this process or contract really mean? It’s an emotional time, but you have to try to keep the emotion out of it. That’s what I would tell myself.”
What to Do if You’re Facing Foreclosure:
Call a HUD-certified counselor at 1-888-995-HOPE. You’ll get advice and help for free, and while counselors can’t ever promise to save a home, they’ll be happy to take a look at any paperwork or information about your case, contact your lender about options if you grant permission, and connect you with vetted legal assistance if need be.
If you’re not facing foreclosure yet, but you’re worried that you’re about to run into trouble, contact your mortgage lender’s loss litigation department. They may be willing to work with you. Your lender can also tell you whether you’ll qualify for government programs.
Overall, don’t let desperation stop you from taking the time to research any potential actions, including signing on with a relief company. Explore the company’s background and track record. Check online for reviews from other homeowners — and be sure to look up phone numbers too. Many scam companies simply shut down, reopen under a new name, and retain the same phone number.
Foreclosure Rates Continue to Improve in the First Quarter...
The residential foreclosure rate has been below pre-recession levels since late 2016 and continues to fall, according to a new report from ATTOM Data Solutions. In fact, the real estate information company’s latest quarterly and monthly analysis of foreclosure data found that foreclosure activity in the first quarter of 2017 was at its lowest level in nearly 11 years nationwide, as well as in 102 of the 216 metropolitan areas analyzed.
“U.S. foreclosure activity on a quarterly basis first dipped below pre-recession averages in the fourth quarter of last year, and this report shows that trend continuing for the second consecutive quarter,” Daren Blomquist, senior vice president with ATTOM Data Solutions, said in a press release. “The number of local markets dropping below pre-recession levels continues to grow, up from 78 a year ago to 102 in this report.”
Total foreclosure filings, including default notices, scheduled auctions and bank repossessions, were down 11% from the last quarter of 2016 and 19% from the year prior. But some states continue to have comparatively high foreclosure rates.
Falling behind on a home loan, or defaulting and going through a foreclosure can have devastating effects on a homeowner’s credit. You can see how your home loan or foreclosure is affecting your credit by reviewing your free credit report summary on Credit.com, and if you’re having trouble making home loan payments, here are some tips you may want to consider to help get you back on track.
The report also shows a total of 83,145 U.S. properties with foreclosure filings in March 2017, up 1% from the previous month but down 24% from a year ago — the 18th consecutive month with a year-over-year decrease in overall U.S. foreclosure activity.
In March, a total of 36,370 U.S. properties started the foreclosure process, up 6% from the previous month but still down 24% from the year prior. That means that, nationwide, one in every 1,604 properties had a foreclosure filing in March.
Meanwhile, the number of completed foreclosures in March were down 4% from February and 15% from the year prior, the report found. Still, some states continue to struggle with higher-than-average foreclosure rates.
Click ahead to see the 10 states with the highest foreclosure rates in the country.
The share of U.S. homes in foreclosure fell slightly in January, down 3.55% from December and down 12.94% from January 2016. The figures come from real estate data company ATTOM Data Solutions, which bases foreclosure rates on the portion of residential properties in any of the three stages of foreclosure: default, auction and repossession.
Much of the decrease came from a decline in foreclosure starts (default), which fell 11.55% from December and 20.11% from January 2016. A great deal of foreclosure activity came from banks purchasing foreclosed homes — the end of the process.
The overall decline indicates fewer American homeowners are falling behind on their mortgages and, as a result, avoiding foreclosure and credit damage. (You can see how your mortgage and other accounts affect your credit by reviewing your free credit report summary, updated every 14 days, on Credit.com.) The list of states with the highest foreclosure rates includes most of the same states that were on it in past months, though most of them saw declines, as well. Here are the 10 states that had the largest portions of homes in foreclosure in January.
The number of U.S. homes in foreclosure fell to a 10-year low in 2016, according to a report from real-estate data company ATTOM Data Solutions, with 933,045 residential properties in some state of foreclosure during the year. That’s a 14% drop from 2015 but is still well above the pre-crisis level of 2006, when 717,522 homes had a foreclosure filing (a notice of default, scheduled auction or bank repossession.)
Much of the nation’s foreclosure activity is left over from the housing crisis, given the foreclosure process is a lengthy one. Among foreclosures completed in the fourth quarter of 2016, the average home had been in the foreclosure process for 803 days, or just over two years. In the same quarter, 55% of loans actively in foreclosure had been originated between 2004 and 2008.
Still, many Americans struggle to afford their mortgage payments. Among the 0.7% of homes in some state of foreclosure last year, slightly more than half of them were new, meaning the homeowners first fell behind on their loans in 2016. Though foreclosure starts were down 16% from 2015, 15 states and the District of Columbia saw a rise in new foreclosures in 2016. (If you’re concerned about being able to afford your home payments, you can read here about how to save your home from foreclosure. You can also see how your mortgage affects your credit by reviewing two of your credit scores for free, with updates every 14 days, on Credit.com.)
Fourteen states had foreclosure rates above the national average, and two of those states even had higher foreclosure rates in 2016 than they did in 2010, when the national foreclosure rate peaked. Here are the 10 states with the highest foreclosure rates in 2016, many of which have a significant backlog of legacy foreclosures (loans that defaulted several years ago).
Foreclosure activity in the U.S. spiked about 27% from September to October — the largest month-over-month increase in foreclosures since August 2007, according to a report from the real-estate focused company ATTOM Data Solutions. One in every 1,258 residential housing units had a foreclosure filing in October, and while the foreclosure rate is higher than it was in September, it’s still lower than it was at the same time last year.
ATTOM defines foreclosure activity as a property whose owner has received a notice of default on the mortgage, is scheduled for auction or has been repossessed by the bank (basically the beginning, middle and end of the foreclosure process, though these terms and procedures vary by state). Much of the foreclosure activity in recent months came by way of bank repossessions, but foreclosure filings of all kinds increased from September to October.
“The increase in October isn’t enough evidence to indicate a new foreclosure crisis emerging in these states, but it certainly demonstrates that this housing recovery is not completely devoid of risk,” said Daren Blomquist, senior vice president at ATTOM, in a press release about the report. “The loans used in this housing recovery that appear to be most susceptible to foreclosure are those such as FHA and VA with low down payments.”
Forty-six states reported a month-over-month increase in foreclosure activity, meaning homeowners all over the country may be struggling to make their home loan payments. And as much as making a late payment on your mortgage can hurt your credit, losing your home to foreclosure can damage your credit for far longer. If your mortgage payments are a challenge, consider reaching out to your lender for help, take a look at this guide on how to save your home from foreclosure and keep an eye on how your loan affects your credit. (You can do that by getting your free credit report summary every two weeks on Credit.com and getting your free annual credit reports.)
Because only four states and the District of Columbia saw a drop in their foreclosure rate from September to October, the list of the 10 states with the highest foreclosure rates remains relatively similar to what it’s been in recent months. Here’s where foreclosures were most common in October.
Residential foreclosure activity fell in September to its lowest level since December 2005, according a monthly report from ATTOM Data Solutions, a housing data company. One in every 1,600 housing units had a foreclosure filing — including notices of default, scheduled auctions and bank repossessions — which is down nearly 24% from the same time last year.
Not only has overall foreclosure activity decreased, the average foreclosure process got a little shorter. The average foreclosure took 625 days to complete as of the third quarter of this year, which is down from 631 days in the second quarter and down from 630 days in the third quarter of 2015. It’s the first time there’s been a year-over-year decline in that timeline since ATTOM started tracking it at the beginning of 2007.
“Foreclosure activity has been on a steady slide downward over the past six years, finally dropping back below pre-crisis levels in September,” Daren Blomquist, senior vice president at ATTOM Data Solutions, said in a press release about the report. “While we’ve know[n] that the national foreclosure problem has been dying a long, slow death for quite some time, the final nail in the coffin of the foreclosure crisis is the year-over-year decrease in the average foreclosure timeline nationwide that we saw in Q3 2016.”
It’s not necessarily that clean-cut, however: The housing crisis played out differently state by state, and foreclosure can take a very long time in some jurisdictions. For example, among foreclosures completed in New Jersey last quarter, the process lasted an average of 1,262 days. That’s nearly 3 1/2 years between defaulting on the mortgage and actually losing the home, and when you figure that’s the average amount of time it takes, there are very likely people who defaulted on their loans during the recession who are still living in those homes.
“A lot of people who are delinquent on their loans are able to stay in their homes for two to five years, depending on what state they’re in. That has dragged out the entire foreclosure process,” Logan Mohtashami, a housing data analyst and a senior loan manager at AMC Lending Group in Irvine, California, said. “The foreclosure crisis, in the sense that new delinquencies were being created, ended years ago. The process of working through the foreclosures from the housing crisis is still going on.”
Additionally, the share of government sponsored loans that are seriously delinquent (more than 90 days past due) is still a little higher than it was pre-recession, according to data from Freddie Mac, Freddie Mae, the Mortgage Bankers Association and the Urban Institute. If you’re struggling to afford your mortgage, here are some things you can do to avoid losing your home to foreclosure and prevent devastating damage to your credit score. (You can see how your home loan and other accounts affect your credit by getting a free credit report summary every 14 days on Credit.com.)
Those states where the foreclosure crisis lingers are many of the same that have had high foreclosure rates for much of the last few years. Here’s where foreclosure rates are the highest, as of last month.
U.S. foreclosure activity picked up a bit from July to August, but it’s still generally on the decline, according to the latest report on the topic from ATTOM Data Solutions. One in every 1,395 U.S. housing units had a foreclosure filing in August (a default notice, scheduled auction, bank repossession or an something similar — filings vary by state), and that’s about a 10% increase from July. The change since last August shows a more encouraging trend: The national foreclosure rate fell by about 13%.
But in the states where foreclosure rates have been the highest in recent years, things remain volatile. While seven of the 10 states with the highest foreclosure rates last month recorded year-over-year declines in foreclosure activity, only three of those states saw declines in excess of the national average. And in six of those 10 states, the foreclosure rate increased more than the national average since July.
Any stage of foreclosure can be stressful on a homeowner, whether they’ve fallen behind on a mortgage payment for the first time or are at the end of a sometimes years-long process of forfeiting their home to the bank. In addition to the financial and emotional affect these processes have, they can also seriously damage a consumer’s credit for many years. But even if you’ve started to struggle with your mortgage payments, it’s worth exploring your options for avoiding foreclosure. All mortgage borrowers should keep an eye on how their home loan affects their credit as part of good financial housekeeping, as well — you can get your credit scores, updated every 14 days, by getting a free credit report summary on Credit.com.
Here’s an update on how some of the states with the highest foreclosure rates are faring, based on the August foreclosure data from ATTOM.
Buying a home is one of the largest financial commitments you can make and sometimes people get in over their heads with this purchase. According to the latest data from RealtyTrac, a total of 253,408 U.S. properties started the foreclosure process in the first half of this year. While that is a large number, it is down 17% from a year ago, which is the lowest amount seen in a half-year time since RealtyTrack started monitoring foreclosure data in 2006.
“Although there are some local outliers, the downward foreclosure trend continued in the first half of 2016 in most markets nationwide,” Daren Blomquist, senior vice president at RealtyTrac, said in a press release.
If you’re having a hard time with your housing budget, you may want to consider asking your lender(s) for guidance to help you avoid foreclosure. Missing a mortgage payment or two can affect your credit scores, but a foreclosure will be even more detrimental. (To see how your mortgage is affecting your credit scores, you can review your free credit report summary, updated monthly, on Credit.com.)
Check out the 10 states with the highest foreclosure rates so far in 2016.
During the Great Recession, many Americans lost their homes due to foreclosure. In fact, according to real estate data company RealtyTrac, there were 6,324,545 completed foreclosures from January 2006 to April 2016.
“It is a big number,” Daren Blomquist, Senior Vice President of RealtyTrac said in an email. “Normal would be around 250,000 bank repossessions per year. These last 10 years represented the biggest loss of home ownership and shifting of real estate wealth since the Great Depression.”
“The foreclosure crisis is largely behind us, although still certainly lingering in certain pockets,” Blomquist said. “Unfortunately, we are already seeing signs of another housing bubble in certain markets, so people should continue to be cautiously optimistic when it comes to the housing market.”
But Blomquist says people who can truly afford to buy a home may still benefit from it.
“Homeownership done responsibly is still one of the best ways to build wealth,” Blomquist said.
What a Foreclosure Can Mean for You
“Foreclosure will obviously create a crater in a credit report for some time,” Troy Doucet, attorney with Doucet & Associates in Columbus, Ohio, said in an email. “However, foreclosure is not the end of the world. Those with foreclosure in their credit past will find their credit scores slowly improve as time passes. After a few years, they may even be able to buy another house.”