Bankruptcy filings continue to rise across the United States. According to the Administrative Office of the U.S. Courts, total bankruptcy filings increased 11% in 2025, reaching more than 574,000 filings nationwide.
Behind every filing is a homeowner facing difficult financial decisions, uncertainty and often significant emotional stress. For real estate agents, these situations require a different approach—one built on trust, education and a genuine commitment to helping homeowners understand their options.
Understanding the human side of bankruptcy
Bankruptcy can result from unexpected medical expenses, job loss, divorce, or mounting debt. While filing does not automatically mean a homeowner will sell, some may explore a sale to reduce debt, avoid further financial strain, or create a fresh start.
In these situations, agents have an opportunity to serve as trusted resources by helping homeowners understand their options rather than pushing them toward a particular outcome.
Why trust matters more than timing
Because bankruptcy filings become public record, many homeowners receive outreach from investors, agents and service providers shortly after filing.
The agents who stand out are often those who slow down the conversation. Instead of focusing on the property, focus on what the homeowner is trying to accomplish.
Are they hoping to keep the home?
Preserve equity?
Avoid foreclosure?
Reduce financial pressure?
Understanding the goal behind the situation allows agents to have more meaningful conversations and provide relevant guidance. Often, the most valuable thing an agent can provide is clarity during a confusing time.
Ethics and compliance go hand in hand
When working with bankruptcy-related leads, professionalism and compliance should remain top priorities. Agents should communicate transparently, avoid making guarantees and respect a homeowner’s decision if they’re not interested in discussing a sale.
Agents should also remain mindful of applicable federal, state and local marketing regulations. Building relationships with bankruptcy attorneys and other trusted professionals can provide homeowners with additional resources while reinforcing the agent’s role as a trusted advisor.
Common mistakes to avoid
- Assuming every bankruptcy filing equals a listing opportunity. Some homeowners file specifically to keep their property, particularly under Chapter 13 repayment plans.
- Treating public records as a trigger for immediate sales outreach rather than an opportunity to provide value.
- Assuming financial distress means a homeowner lacks equity. Many homeowners still have substantial ownership interest in their property.
- Leading with urgency instead of education. Homeowners are often evaluating multiple paths forward.
- Failing to research ownership history, equity, liens and local market conditions before reaching out.
Rather than relying on assumptions, agents can use property information to gain a clearer understanding of a homeowner’s circumstances before initiating contact.
Using property information for better context and outreach
Factors such as ownership history, estimated equity, liens and property characteristics can help agents approach conversations more thoughtfully and avoid making assumptions about a homeowner’s situation.
Tools like PropStream’s Bankruptcy Lead List help agents identify homeowners facing bankruptcy-related challenges while providing valuable property insights to guide more informed and professional conversations.
Once a lead has been identified, PropStream’s marketing tools can help agents organize outreach and follow-up efforts, making it easier to maintain consistent communication while respecting the homeowner’s timeline and decision-making process.
Activate your 7-day free trial of PropStream and remember: the goal isn’t to be the first agent to call—it’s to be the most prepared.
