Is Florida the Worst State for Foreclosures?

Not anymore, and that’s new as of this morning. Florida held the nation’s worst foreclosure rate through the first half of 2026, and that’s still the number showing up in most of the coverage sitting on Google right now. ATTOM’s fresh August numbers move Florida to third. It still leads the country on a different measurement, just not the one behind those earlier headlines.

What Changed Between the Summer Numbers and Now?

The “worst in the nation” headlines trace back to ATTOM’s first half of 2026 report: 27,494 Florida properties with a foreclosure filing between January and June, a rate of 0.27 percent of housing units, the highest of any state at the time. That’s the number several Florida news outlets ran with in July, and it’s the number Google’s own AI summary is still pulling forward.

ATTOM’s August 2026 report, released this morning, tells a different story. By rate, Florida now ranks third, one filing for every 2,397 housing units, behind South Carolina at one in 1,547 and Nevada at one in 1,920. The state that had the worst rate in the country over six months isn’t the state with the worst rate this month.

So Is Florida Still Number One at Anything?

Yes, on raw count. Florida led the nation in foreclosure starts in August: 3,189, ahead of Texas at 3,126, California at 2,565, Illinois at 1,192 and Georgia at 1,189. A rate divides by how many houses exist in the state. A raw count doesn’t. Florida is a big state, so it produces a big count on that second measure almost by default. Being first in starts and third in rate aren’t in conflict. They’re two different rulers, and the coverage that only tracked one of them for most of the year is why the “worst in the nation” line is still circulating.

How Many Florida Foreclosures Actually Happened in August?

ATTOM counts properties that picked up at least one foreclosure filing during the month, across default, auction and bank repossession, in more than 3,000 counties covering over 99 percent of the country. Nationally, 40,277 properties had a filing in August, up 1 percent from July and up 13 percent from a year ago. Lenders started the process on 25,894 properties, and Florida’s 3,189 starts were part of that. Lenders took back 5,794 properties through completed foreclosures nationally, up 42 percent from a year ago. That 42 percent is a real increase, and it’s also on a small base. ATTOM’s own release says overall foreclosure volume is still well below where it ran before the 2020 to 2022 period.

The most extreme number in the report isn’t a state, it’s a metro: Punta Gorda, on Florida’s southwest coast in Charlotte County, posted the second worst foreclosure rate of any metro in the country, one filing for every 1,249 housing units. That’s a different market than Northeast Florida, but it’s a reminder that a statewide number can hide a lot of variation underneath it.

If Home Prices Are Still Rising, Why Are Foreclosures Going Up Too?

Florida Realtors released its August statistics the same week. The statewide single family median sale price rose just over 1 percent to $415,000, the sixth straight month of year over year gains. Inventory fell 13 percent from a year earlier. Dr. Brad O’Connor, the group’s chief economist, put it this way: “Sales remain relatively stable, inventory continues to tighten, and home prices are holding up well despite mortgage rates that remain challenging for many buyers.”

Those two releases aren’t arguing with each other. Florida Realtors counts what sold and what it sold for. ATTOM counts court and county filings on people who stopped paying. A household stops paying because of what happened to its own income, not because of what happened to the statewide median, so a market that’s holding and a foreclosure count that’s climbing can run side by side for a long time.

What Does This Mean if You’re Behind on Payments?

The rising median and the shrinking inventory are the useful half of this, if there’s equity in the house. A home that can sell before it reaches the end of the foreclosure process usually does, and right now homes are selling. Where there isn’t enough equity to cover what’s owed, a short sale is the option that closes that gap, selling the house for less than the balance, with the lender’s approval.

Foreclosure starts are up 7 percent over the year, and completed repossessions are up 42 percent off that smaller base, which means more files are running all the way through rather than getting resolved earlier. Neither number tells you what happens on any one house. That comes down to the loan documents, the lender, and how much room is actually left.

In other news, the Federal Reserve raised interest rates yesterday afternoon for the first time in three years, and if you’re behind on payments, here’s where that does and doesn’t reach you.

Will My Mortgage Payment Go Up Now That the Fed Raised Rates?

If you have a fixed rate mortgage, no. It can’t. The rate is written into the note you signed, and the Fed doesn’t have a hand on it.

On September 16, the Federal Open Market Committee voted 12 to 0 to raise the federal funds target range a quarter point, to 3-3/4 to 4 percent. That’s an overnight rate banks charge each other. It isn’t your mortgage rate, and it isn’t even the prime rate, which is a separate number that banks set themselves and the Fed only reports.

Which of My Debts Actually Move When the Fed Raises Rates?

The ones priced off a short term index; mainly a home equity line of credit. The CFPB’s own HELOC guide is direct about it: a HELOC typically carries a variable rate built from two pieces, an index and a margin, and the most common indexes are the prime rate and the Treasury’s constant maturity rate. The booklet also says plainly that monthly payments can change even if you never draw another dollar against the line.

That exposure isn’t small. The New York Fed’s household debt report for the second quarter of 2026 put total HELOC balances at $459 billion, up $13 billion in the quarter and $48 billion over the year. Mortgage balances actually fell $74 billion in the same quarter, to $13.117 trillion. And the share of mortgage debt flowing into serious delinquency ran at 1.52 percent in the second quarter, against 1.29 percent a year earlier. That’s a flow into new trouble, not a share of all mortgages that are behind.

What About Rates on a New Loan?

Those were already climbing before the Fed acted, and for a different reason: the 10 year Treasury yield, which sat at 5.00 percent on September 15, up from 4.83 percent less than a week earlier. The Mortgage Bankers Association’s weekly survey, for the week ending September 11, put the average 30 year conforming rate at 6.97 percent, up from 6.85 the week before. Joel Kan, the group’s deputy chief economist, described it plainly: “Ongoing market concerns over spiking energy prices, persistently high inflation, and future monetary policy pushed bond yields and mortgage rates higher last week.” Applications fell 4.1 percent that same week.

What Does This Mean if You Have a Second Mortgage or a HELOC?

The same CFPB guide says a lender can freeze or reduce a credit line if the home’s value drops or your financial situation gets worse, and that when a home sells, the HELOC generally has to be paid off in full at closing. A falling value, a frozen line, and a balance that has to clear at the closing table: that’s the shape of a file that stalls, and it’s usually the second lien deciding it, not the first mortgage everybody assumes is the problem.

Jacksonville, Florida is where I work, and distressed property is most of what comes through the door here. Happy to talk through where your situation fits into any of this.

JimArmstrong904@gmail.com, or (904) 671-4161 if talking beats typing.

Jim Armstrong, REALTOR® · Momentum Realty · SFR® (Short Sales and Foreclosure Resource) certified. This is general information, not legal, tax, or financial advice.

Momentum Realty is not associated with the government, and our service is not approved by the government or your lender.