Foreclosure Filings Up 10% Annually in July

U.S. foreclosure filings experienced a 10% year-over-year increase in July, reaching a total of 39,906 properties. This figure represents a 1% rise compared to the previous month, June. The data, compiled by ATTOM, a property data provider, indicates a growing trend in distressed real estate. In addition to new foreclosure filings, the number of REO (real estate owned) properties, which are homes repossessed by lenders after a foreclosure sale, also saw a substantial increase. REO properties rose by 23% from July 2025 to July 2026. This surge in REO properties suggests that lenders are taking possession of more homes that have gone through the foreclosure process, potentially leading to an increase in the supply of distressed homes on the market. The report from ATTOM highlights that while the overall number of foreclosure filings remains below historical peaks seen during the 2008 financial crisis, the recent upward trend warrants attention. The increase in both filings and REO properties could signal a tightening housing market for some segments, particularly for homeowners struggling with mortgage payments. Factors contributing to these increases may include rising interest rates, persistent inflation impacting household budgets, and the expiration of pandemic-era homeowner protections. ATTOM's analysis typically tracks various stages of the foreclosure process, including default notices, scheduled auctions, and bank repossessions. The specific breakdown for July 2026 shows that states with the highest number of foreclosure filings included California, Texas, and Florida, which are also the most populous states. However, the report also points to states with the highest foreclosure rates (percentage of dwelling units with a foreclosure filing), which may differ from raw numbers due to population variations. For instance, states like Delaware, Illinois, and New Jersey have historically shown higher foreclosure rates in certain periods. The increase in REO properties is a key indicator for real estate investors and the broader housing market, as these properties are often sold at a discount, potentially impacting property values in affected areas. Lenders typically aim to sell REO properties quickly to recoup their losses, which can lead to a more active distressed property market. The trend observed in July 2026 suggests that the housing market is undergoing adjustments, with a noticeable uptick in foreclosure activity. This data is crucial for policymakers, lenders, and consumers to understand the evolving landscape of homeownership and mortgage stability. Further analysis will be necessary to determine if this trend continues in the coming months and what its long-term implications will be for the U.S. housing market.