Are Foreclosures Increasing in 2026? Here’s What the Data Says…

You’ve probably seen the headlines saying foreclosures are rising, and for a lot of people, that immediately brings back memories of 2008. That reaction makes sense. The housing crash left a lasting impression, and nobody wants to see the market go through something like that again. But the reality is, today’s market looks very different from what it did back then — and the numbers help show why.

Foreclosures Are Increasing, But They’re Still Low Historically

Yes, foreclosure filings are up compared to last year. According to ATTOM, filings have increased 26% year-over-year and have now risen for five straight quarters. That’s definitely a trend worth paying attention to, but it doesn’t tell the whole story.

What’s happening right now is much more of a return to normal market activity than a warning sign of another crash.

The foreclosure numbers from 2020 and 2021 were unusually low because of pandemic-related foreclosure moratoriums put in place by the government. Those years weren’t considered normal market conditions, so using them as the comparison point can make today’s increase seem more dramatic than it really is.

When current numbers are compared to the market before the pandemic — like 2017 through 2019 — foreclosure activity is still lower than typical levels.



And when looking back at the foreclosure levels around 2008, the difference is even more obvious. Even with today’s increases, the market is nowhere close to the levels seen during the housing crash. This is a normalization trend, not a crisis.

Home Equity Is One of the Biggest Differences Today

Another major reason today’s market looks different is homeowner equity.

According to Cotality, the average homeowner is currently sitting on about $295,000 in equity. During the 2008 crash, many homeowners actually owed more than their homes were worth, which left very few options outside of foreclosure.

Today, many homeowners still have enough equity to potentially sell their home, pay off what’s owed, avoid foreclosure, and in some cases still walk away with money remaining after the sale.

That’s a huge difference compared to what happened during the last housing downturn, and it’s one of the main reasons foreclosure activity is far less likely to spiral the same way it did back then.

The graph below helps show that story clearly:

• The yellow line represents all foreclosure filings
  
  
• The orange line shows foreclosure starts
  
  
• The red line tracks completed foreclosures, where a homeowner actually lost the property
  
  

Even historically, completed foreclosures stay much lower than total filings because many homeowners are able to work out another solution before foreclosure is finalized.

There Are Usually More Options Than People Realize

Falling behind on mortgage payments can feel overwhelming, but missing payments does not automatically mean foreclosure is inevitable.

In many cases, lenders would rather work with homeowners than go through the foreclosure process themselves because it can be expensive and time-consuming for both sides. Depending on the situation, options may include repayment plans, temporary forbearance, or loan modifications that make payments more manageable.

The earlier communication happens with the lender, the more flexibility and potential solutions there usually are. In some states, foreclosure timelines can move faster than expected, so acting early can make a major difference.

And in situations where selling becomes the better option, speaking with a real estate professional can help determine current home value, available equity, and whether selling could help avoid further financial strain.

Bottom Line

Foreclosure filings have been increasing, but overall levels still remain historically low. Combined with the amount of equity many homeowners have built over the last several years, today’s housing market looks very different from the conditions that led to the 2008 crash.