Foreclosure Filings Just Rose 13% Year Over Year, With the South Hit Hardest
Filings are climbing, fast
Foreclosure filings rose 13% year over year in August, according to ATTOM's August 2026 U.S. Foreclosure Market Report. The data shows 40,277 U.S. properties with foreclosure filings in the month, including default notices, scheduled auctions, and bank repossessions. That was up 1% from July and marked a clear step up from August 2025.
"August's data shows that foreclosure activity continues to trend above year-ago levels, particularly in completed foreclosures, which saw a notable annual increase," said Rob Barber, CEO of ATTOM. He added that overall volumes remain well below historical norms and that the broader housing market continues to show resilience.
Lenders initiated foreclosure proceedings on 25,894 U.S. properties in August, down 3% from the previous month but up 7% from a year earlier. Nationally, one in every 3,569 housing units had a foreclosure filing.
The South is getting hit hardest
South Carolina recorded the highest state foreclosure rate, with one filing for every 1,547 housing units. Nevada followed at one in 1,920, then Florida at one in 2,397, Texas at one in 2,445, and Maryland at one in 2,530.
The metro picture tells the same story. Among metro areas with populations of at least 200,000, Columbia, South Carolina, had the highest rate at one filing for every 1,232 housing units. Punta Gorda, Florida, came in at one in 1,249, followed by Spartanburg, South Carolina, at one in 1,262, Fayetteville, North Carolina, at one in 1,458, and Charleston, South Carolina, at one in 1,501.
Florida had the most foreclosure starts of any state with 3,189, followed by Texas with 3,126, California with 2,565, Illinois with 1,192, and Georgia with 1,189. Some metros bucked the trend: Cleveland posted the largest year-over-year decline in starts, falling from 281 to 175, with Washington, D.C., Providence, Raleigh, and Kansas City also declining.
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How this could hit the options market
Rising foreclosures are a warning light for housing-exposed names. Watch options flow on homebuilders that live and die by buyer demand and credit quality: DHI and LEN are the sector leaders, and rising completed foreclosures can pressure resale prices and builder margins alike. A pickup in put activity on either name would signal traders betting the distress is spreading.
Mortgage originators and servicers sit even closer to the action. Keep an eye on RKT and UWMC, where default trends feed directly into servicing costs and origination volumes. Unusual call or put flow here often shows up before the headline numbers move the stocks.
For broader market context, bank repossessions are the sharpest-growing category in the report. Large banks with mortgage books, like JPM, could see credit-loss questions come back into focus if filings keep climbing. And real estate ETFs like XLRE are worth watching for sector-wide sentiment shifts. The overall volumes are still well below historical norms, but the trend is what traders price in.
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