Lenders started the foreclosure process on 67,249 U.S. properties in Q3 2022, up 1% from the previous quarter and up 167% from a year ago, nearly reaching pre-pandemic levels, according to a new report from ATTOM released this week.
ATTOM’s Q3 2022 U.S. Foreclosure Market Report found that a total of 92,634 U.S. properties have foreclosure filings, up 3% from the previous quarter and 104% from a year ago. The report also found that there were a total of 31,836 properties with foreclosure filings in September 2022, which is down 8% from August but up 62% from September 2021. Additionally, one in every 1,517 properties had a foreclosure filing, and lenders repossessed 10,515 properties through foreclosure (REO), up 18% from the previous quarter and up 39% from a year ago.
Key highlights:
- States that posted the greatest number of foreclosure starts in Q3 2022 included California at 7,368; Florida at 6,671; Texas at 6,217; Illinois at 4,702 and New York at 3,997.
- Metropolitan areas that had the highest foreclosure starts included New York City at 4,621; Chicago at 3,950; Los Angeles at 2,275; Philadelphia at 1,991 and Miami at 1,990.
- A decline in foreclosure starts was found in the metro areas of Tulsa at -60%; Kansas City at -26%; Birmingham at -25%; Minneapolis at -23% and Cincinnati at -22%.
- Foreclosure rates were highest in the states of Illinois (one in every 694); Delaware (one in every 825); New Jersey (one in every 855); South Carolina (one in every 971) and Ohio (one in every 1,027).
- Metro areas with the highest foreclosure rates were Peoria (one in every 472); Cleveland (one in every 589); Jacksonville (one in every 593); Columbia (one in every 599) and Rockford (one in every 602).
- States that posted the largest number of completed foreclosures included Illinois at 1,331 REOs; Michigan at 729 REOs; New York at 695 REOs; Pennsylvania at 643 REOs and Ohio at 557 REOs.
- Properties foreclosed in Q3 2022 had been in the foreclosure process an average of 885 days, down from 948 days in the previous quarter and down 4% from 924 days in Q3 2021
- The longest average foreclosure timelines were in the states of Hawaii at 2,121 days; New Jersey at 2,002 days; Louisiana at 1,963 days; Kansas at 1,848 days and New York at 1,808 days.
- The shortest average foreclosure timelines were in Minnesota at 113 days; Mississippi at 167 days; Texas at 168 days; Nebraska at 168 days and Missouri at 172 days.
Major takeaway:
“Foreclosure starts, while rising since the end of the government’s foreclosure moratorium, still lag behind pre-pandemic levels,” said Rick Sharga, executive vice president of market intelligence for ATTOM. “Foreclosure activity is reflecting other aspects of the economy, as unemployment rates continue to be historically low, and mortgage delinquency rates are lower than they were before the COVID-19 outbreak.”
Added Sharga, “Very few of the properties entering the foreclosure process have reverted to the lender at the end of the foreclosure. In fact, nearly three times more homes were repossessed by lenders in the second quarter of 2019 than in the second quarter of 2022. We believe that this may be an indication that borrowers are leveraging their equity and selling their homes rather than risking the loss of their equity in a foreclosure auction.”
For the full report, click here.
