You may have come across headlines pointing to a recent uptick in foreclosures. While that might raise some concerns, especially with memories of the 2008 housing crash still fresh for many, it’s important to look at the bigger picture—and that picture is far more reassuring than alarming.

According to data from ATTOM, during the height of the last housing crisis (2007-2011), more than nine million homeowners went through some form of distressed sale. In comparison, just over 300,000 foreclosures occurred last year. So, while there has been a recent increase, the current numbers are still a fraction of what they were during the downturn.

Looking ahead, is there a surge of foreclosures looming? The short answer: no.

One of the main indicators experts watch to gauge potential foreclosure risks is the rate of mortgage delinquencies—specifically loans that are more than 30 days overdue. The latest data shows that delinquency rates are stable and consistent with the end of last year, suggesting there’s no major shift in overall mortgage performance.

That said, there are some important details worth noting. Marina Walsh, Vice President of Industry Analysis at the Mortgage Bankers Association, points out:

“While overall mortgage delinquencies are relatively flat compared to last year, the composition has changed.”

Specifically, FHA loans are currently seeing the largest share of new delinquencies (see graph below).

This trend doesn’t necessarily spell trouble. FHA borrowers often have lower down payments and may be more financially sensitive to economic pressures. With ongoing concerns about inflation, employment, and economic shifts, it’s understandable that this group may be feeling more strain. However, this doesn’t signal a market-wide issue.

Looking at the broader picture, the data shows that delinquency rates for other types of loans remain low and stable. Back in 2008, all loan categories saw sharp increases in delinquencies. Today, that’s not the case—a strong sign of the market’s overall health.

As ResiClub explains:

“The recent uptick in mortgage delinquency seems to be concentrated among FHA borrowers, however, mortgage performance remains very solid when viewed in light of the twenty-year history of our data.”

Another reassuring factor is that FHA loans make up only about 12% of all home loans nationwide. While there are some regions—particularly in the South—where FHA loans are more common, the concentration of these loans doesn’t equate to widespread risk.

The map below doesn’t show delinquency rates, but rather highlights which states have the highest concentration of FHA loans (see map below):

According to the Federal Reserve Bank of New York:

“Looking at geographic concentrations of loans, recent data indicate that a higher proportion of mortgage balances are delinquent in many of the southern states . . . we see that higher delinquency rates coincide with a higher share of FHA loans across states.”

Even in these areas, the current delinquency rates remain well below what was seen during the 2008 crisis. So while these trends warrant attention, they are not warning signs of an imminent crash. Experts will continue to monitor the data, but for now, the overall outlook remains stable.

If You’re Experiencing Financial Hardship

Facing potential foreclosure is never easy, but it’s important to remember that there are options and support available. If you’re a homeowner struggling with your mortgage, your first step should be reaching out to your lender. Many lenders offer repayment plans or loan modifications that can help you stay on track.

Additionally, in today’s market, many homeowners have significant equity in their homes. That means selling your home might be a viable option to avoid foreclosure altogether. In fact, some of the current delinquencies may ultimately resolve this way, thanks to the strong equity position homeowners are in today.

Bottom Line

Foreclosures are edging upward slightly, but they remain far below the levels seen during the last housing crash. Mortgage delinquencies are stable, and the broader market is in a much healthier position. While it’s wise to stay informed, there’s no indication of a crisis ahead.

If you have questions about what these trends mean for you or your local market, don’t hesitate to reach out to Mike Panza and the team at Panza Home Group. They're here to help you navigate the market with confidence. For more information, visit: https://panzarealestate.com/team/mike-panza.