Hearing that foreclosure filings are rising can bring back uncomfortable memories of the housing crash. If you owned a home through that period, it is understandable to wonder whether another wave of foreclosures could be ahead.
But an increase does not tell the whole story. You also need to know where the numbers started, how they compare with crisis levels and what is different for homeowners.
The historical comparison behind this article makes an important distinction: foreclosure activity rising from unusually low levels is not the same as foreclosure activity reaching housing-crash levels. Here is how to put that difference into perspective without dismissing your concerns or letting a headline make the decision for you.
Start With What the Headline Is Comparing
A headline can correctly report an increase and still leave out the context that makes the number useful.
In the comparison discussed here, foreclosure filings were rising from historic lows. That starting point matters. Measuring activity against an unusually quiet period can make the increase sound more dramatic than the broader picture supports.
Think of these as two separate questions:
- Are foreclosure filings higher than they were during the unusually low period?
- Are foreclosure filings anywhere near the levels seen during the housing crash?
The answer to the first question can be yes without the answer to the second question being yes. Treating those questions as interchangeable is where a lot of the worry begins.
The direction of the numbers matters, but so does their level. An increase alone is not enough to establish that the housing market is in trouble.
Why Foreclosures Fell to Historic Lows
The unusually low foreclosure figures had a specific backdrop. A foreclosure moratorium and a forbearance program helped millions of homeowners avoid foreclosure during a challenging period.
Those protections help explain why the comparison starts from such low numbers. The lower activity was not simply a normal baseline that should automatically be expected to continue.
After the moratorium ended, foreclosure activity resumed and filings rose. In that context, the increase was expected rather than a surprise.
That does not mean you should ignore foreclosure information. It means the information needs to be read alongside the conditions that shaped it. Comparing a period with those protections against a period after they ended leaves out an important part of the story unless that difference is explained.
Compare the Totals With the Housing Crash
For anyone worried about a repeat of the housing crash, the more useful comparison is with foreclosure activity surrounding that crisis, not only with the lowest point that followed.
Research from ATTOM, a property data provider, supplied the historical comparison used in the original article. That comparison showed foreclosure activity remaining consistently lower after the crash than during the crisis period.
The difference in scale was substantial:
- During the crisis-level years highlighted in the comparison, annual foreclosure filings exceeded 1 million.
- The lower-activity annual total cited for comparison was roughly 357,000 filings.
Those are historical figures, not a live reading of the market. Their value here is the perspective they provide: the cited increase did not put foreclosure activity anywhere close to the crisis totals.
Both points can be true at once. Filings can rise from historic lows while remaining far below the levels associated with the housing crash. A useful explanation needs to include both, rather than presenting the increase by itself.
Homeowner Equity Is Another Important Difference
The number of filings is only part of the comparison. The original article also pointed to homeowner equity as a reason conditions differed from those surrounding the crash.
Bankrate explained that millions of foreclosures flooded the housing market in the years after the crash, depressing home prices. Its explanation contrasted that period with homeowners having a comfortable equity cushion in their homes.
The original article made the same point in plain English: most homeowners in the market it described had enough equity to help keep them out of foreclosure.
That equity position was presented as a positive for homeowners and for the broader housing market. It was also a key reason the article did not view rising filings as evidence that the earlier foreclosure crisis was repeating.
The comparison is about more than whether filings went up. It also considers how homeowners were positioned and whether the market was experiencing the same flood of foreclosures that had depressed prices during the crash.
What the Comparison Supports
The original article's conclusion was that the expected increase in foreclosures was not a foreclosure crisis, did not point toward one and would not lead to another crash in home prices.
Read that conclusion in the context of the evidence it discussed: filings rising from historic lows, totals far below crisis levels and an equity cushion for most homeowners.
For an evergreen takeaway, avoid turning that historical assessment into a promise about future prices. The practical lesson is narrower and more useful: a rise in foreclosure filings, by itself, does not establish that another housing crash is coming.
Put Context Before Your Next Decision
If a foreclosure headline has you questioning a purchase, a sale or your plans to stay put, slow down and check the comparison before reacting.
- Identify the starting point. Is the increase measured against an unusually low period?
- Look at the actual totals. How do they compare with the crisis levels being discussed?
- Read the explanation. Does it address the moratorium, forbearance and homeowner equity?
You do not have to dismiss the numbers, and you do not have to assume the worst. Start with the context, then focus on the decision in front of you.
Bring the article or headline that concerns you and write down your questions. Reach out to Ed Parcaut to talk through the information and how it relates to your homeownership and mortgage plans.
