U.S. Foreclosures Rise for Sixth Straight Month as Affordability Pressures Mount

U.S. foreclosure activity climbed again in August 2025, marking the sixth consecutive month of annual increases, as high borrowing costs and stretched household finances begin to weigh more heavily on homeowners.

Some 35,697 properties had foreclosure filings last month, according to real estate data firm ATTOM. That’s down 1% from July but 18% higher than a year earlier, underscoring what analysts say is a slow but steady return of distress to the housing market.

“Foreclosure volumes are still running below pre-pandemic levels, but the ongoing rise in both starts and completions suggests added financial strain is emerging in this high-cost, high-rate environment,” said Rob Barber, ATTOM’s chief executive officer.

Regional Hotspots

Foreclosure rates were highest in Nevada, South Carolina and Florida. Nationwide, one in every 3,987 homes had a filing. In Nevada, the figure was one in every 2,069.

Several midsize cities saw the sharpest impacts. Lakeland, Florida, topped all metro areas with one in every 1,212 homes facing a foreclosure filing, followed by Columbia, South Carolina, and Chico, California. Among the largest U.S. metros, Cleveland, Las Vegas, Jacksonville, Houston and Orlando posted the highest foreclosure rates.

Starts Edge Higher

Lenders started the foreclosure process on 24,254 properties in August, little changed from July but nearly 17% above last year. Texas led with nearly 3,000 starts, followed by Florida, California, New York and Illinois.

New York City recorded the most foreclosure initiations among large metro areas, trailed by Houston, Chicago, Los Angeles and Miami.

Completions Jump

Completed foreclosures — when properties are repossessed by lenders — rose more sharply. Nationwide, 4,077 homes were taken back in August, up 5% from the prior month and 41% year-over-year.

Texas, California, New York, Florida and Illinois had the highest totals. Chicago, New York, Houston, San Antonio and Dallas ranked as the major cities with the most repossessions.

Outlook

Foreclosure levels remain muted compared with historic norms, but the trend line points upward. If high mortgage rates and home prices persist, analysts warn the housing market could see more distressed sales in the months ahead.

“The trajectory is unmistakable,” Barber said. “We’re seeing foreclosure activity gradually reemerge as a pressure point in the housing sector.”