Short answer. The CARES Act foreclosure moratorium and forbearance programs cut the U.S. foreclosure rate to ~0.16% in 2021 — the lowest reading on record. Rates remained suppressed through 2022 and have only partially normalized since.
| Year | Foreclosure Filings (approx.) | Notes |
|---|---|---|
| 2019 | ~493,000 | Pre-COVID baseline |
| 2020 | ~214,000 | CARES Act moratorium begins |
| 2021 | ~151,000 | Extended moratorium |
| 2022 | ~324,000 | Moratorium ends; filings rebound |
| 2023 | ~357,000 | Returning toward baseline |
| 2024 | ~322,000 | Still below pre-COVID level |
The CARES Act of March 2020 created the largest foreclosure intervention in U.S. history. Federal-backed loans (Fannie Mae, Freddie Mac, FHA, VA) were prohibited from initiating foreclosure proceedings, and homeowners could request forbearance — pausing payments without immediate foreclosure consequence — for up to 18 months. Roughly 9 million U.S. mortgages entered some form of forbearance during 2020–2021.
The collapse in foreclosure activity
Foreclosure filings, ATTOM data:
- 2019: 0.36% of housing units (~493K filings) — pre-pandemic baseline
- 2020: 0.16% (~214K filings) — moratorium kicks in mid-year
- 2021: 0.11% (~151K filings) — record low
- 2022: 0.23% (~324K) — moratorium fully expired
- 2023: 0.26% (~357K)
- 2024: ~0.30% (~410K) — gradual normalization
The 2021 reading is the lowest annual foreclosure rate in the modern record by a meaningful margin. The previous low had been roughly 0.34% in 2019.
Why the moratorium worked
The COVID intervention was structurally different from any prior foreclosure relief program:
- Speed. Forbearance applications could be submitted and approved within days, rather than the months-long modification negotiations that characterized 2009–2012 HAMP processes.
- Scale. 9M households accessing relief is roughly 4× the peak 2010 modification volume.
- Underlying labor market. Unlike 2008–2010, the 2020 employment shock reversed quickly. Most forbearance recipients were back at work within 6–9 months and able to resume payments.
- Home equity. Most 2020 borrowers had positive equity that the 2009 cohort lacked. Even forbearance failures could be resolved through sale rather than foreclosure.
The post-moratorium normalization
The moratorium expired in mid-2021, but foreclosure activity has only gradually returned to the pre-pandemic baseline. The 2024 reading remains roughly 17% below 2019 levels. Three factors have kept post-moratorium rates suppressed: (1) home-price appreciation gave most distressed borrowers an exit through sale rather than foreclosure; (2) labor markets remained tight through 2023 and 2024; (3) servicer modification programs absorbed many of the cases that would otherwise have advanced to foreclosure.
Related
- Foreclosure rate history dashboard
- Q&A — Worst year for U.S. foreclosures
- Q&A — States with highest foreclosure rates
- Q&A — U.S. housing market in 2020
- The COVID Housing Surge, 2020–2024
Sources
U.S. Census Bureau Survey of Construction; National Association of Realtors Existing Home Sales report; Freddie Mac Primary Mortgage Market Survey; National Bureau of Economic Research Business Cycle Dating Committee.