After months of declining foreclosure rates, January saw an uptick in filings
Foreclosure activity in the US ticked upward in January, up 8% from the previous month, according to ATTOM’s latest Foreclosure Market Report.
While foreclosure filings – including default notices, scheduled auctions, and bank repossessions – totaled 30,816 properties, the numbers remain 7% lower than a year ago, continuing a broader trend of annual declines.
The question now is whether this monthly increase signals a shift in the foreclosure landscape for 2025 or if it’s simply a post-holiday backlog working its way through the system.
"January showed a monthly increase in foreclosure filings that may, in some part, be the result of a normal post-holiday catch up of filings," ATTOM chief executive officer Rob Barber said in the report. "It's too early to know if 2025 will shift from the general 2024 trends of a continued decline in foreclosure activity."
Foreclosure completions
Completed foreclosures, or REOs (real estate-owned properties), rose slightly in January, with lenders repossessing 2,973 properties nationwide, up just under 1% from December 2024. However, REOs remain down 25% year over year, continuing a trend of annual declines in 11 of the last 12 months.
Several states saw notable month-over-month increases in completed foreclosures, particularly in:
- Arizona (up 73%)
- Virginia (up 57%)
- South Carolina (up 55%)
- North Carolina (up 52%)
- Tennessee (up 26%)
Lenders initiated foreclosure proceedings on 20,994 properties in January, reflecting an 8% increase from the previous month but still 4% lower than a year ago.
Despite the reversal in foreclosure trends, consumers became more optimistic about the housing market at the start of the year. Fannie Mae’s latest Home Purchase Sentiment Index increased in January, spurred by improved sentiment about homebuying and selling conditions, as well as stronger expectations that home prices will continue to rise over the next year.
Where foreclosures are highest
While foreclosure activity remains below pre-pandemic levels in many areas, some states continue to see higher foreclosure rates than the national average.
In January, one in every 4,618 housing units in the US had a foreclosure filing. The states with the highest foreclosure rates were:
- Delaware (one in every 1,839 housing units)
- Nevada (one in every 2,430 housing units)
- Indiana (one in every 2,459 housing units)
- Illinois (one in every 2,756 housing units)
- Utah (one in every 3,251 housing units)
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The increase in foreclosure activity raises questions about whether the trend will continue for the rest of the year or if it was simply a seasonal fluctuation.
The broader decline in annual foreclosure rates suggests that market fundamentals remain stable, but rising interest rates, economic uncertainty, and employment shifts could put additional pressure on homeowners in the months ahead.
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