Why Today’s Foreclosure Numbers Aren’t a Warning Sign

With the cost of living rising, it’s understandable that some people are concerned about the housing market. Headlines mentioning an uptick in foreclosure filings can trigger fears of another crash like we saw in 2008. But before jumping to conclusions, let’s look at the bigger picture.

This Isn’t 2008

Yes, foreclosure filings have increased slightly this year. But context matters:

• They’re still below historical norms, especially when compared to the years leading up to and during the 2008 crash.

• The lending practices that caused the 2008 collapse—like subprime mortgages—aren’t a factor in today’s market. Lending standards are much stricter now.

• Most homeowners today have strong equity positions, making foreclosure less likely even in tough times.

A graph comparing Q1 2025 to crash-era years shows how low current foreclosure activity still is. While 2020–2021 had unusually low filings due to pandemic-related moratoriums, comparing today to more typical years (like 2017–2019) shows we're still trending below average.

Homeowners Are in a Stronger Position

A key reason foreclosure isn’t surging? Equity.
Over the past few years, rising home prices have given homeowners more equity than ever. If someone is struggling financially, they may be able to sell their home and avoid foreclosure altogether—something that wasn’t possible in 2008 when many owed more than their homes were worth.

As Rob Barber, CEO of ATTOM, says:

“Strong home equity positions in many markets continue to help buffer against a more significant spike [in foreclosures].”

And Rick Sharga, CEO of CJ Patrick Company, adds:

“A significant factor contributing to today’s comparatively low levels of foreclosure activity is that homeowners—including those in foreclosure—possess an unprecedented amount of home equity.”

Bottom Line

Yes, some homeowners are feeling financial pressure. But this is not a repeat of the housing crisis.

• Foreclosure activity is still well below normal levels.

• Lending standards are more responsible.

• Most homeowners have enough equity to avoid foreclosure.

So if you're feeling uneasy about the housing market, know this: the conditions we’re seeing today are very different from those that led to the last crash.

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