SOLANO REAL ESTATE SCENE No need to fear today’s foreclosure headlines

If you’ve seen recent headlines about foreclosures surging in the housing market, you’re certainly not alone. There’s no doubt the stories in the media can be pretty confusing right now. They may even make you think twice about buying a home for fear that prices could crash. The reality is, the data show a foreclosure crisis is not where the market is headed, and understanding what that really means is mission critical if you want to know the truth about what’s happening today. Here’s a deeper look.

According to the Year-End 2022 U.S. Foreclosure Market Report from ATTOM, foreclosure filings are up 115% from 2021, but down 34% from 2019. As media headlines grab onto this 115% increase, it’s more important than ever to put that percentage into context.

While the number of foreclosure filings did more than double last year, we need to remember why that happened and how it compares to more normal, pre-pandemic years in the market. Thanks to the forbearance program and other relief options for homeowners, foreclosure filings were down to record-low levels in 2020 and 2021, so any increase last year is – no surprise – a jump up. Rick Sharga, Executive vice president of Market Intelligence at ATTOM, notes:

“Eighteen months after the end of the government’s foreclosure moratorium, and with less than 5% of the 8.4 million borrowers who entered the CARES Act forbearance program remaining, foreclosure activity remains significantly lower than it was prior to the Covid-19 pandemic. It seems clear that government and mortgage industry efforts during the pandemic, coupled with a strong economy, have helped prevent millions of unnecessary foreclosures.”

Clearly, these options meant millions of homeowners could stay in their homes, allowing them to get back