North Carolina 2nd Largest State inYear-Over-Year Foreclosures

In 2026, the U.S. foreclosure market showed a clear year-over-year rise, with the sharpest increases clustered in a mix of Western, Southern, and Midwestern states. Using ATTOM’s mid-year report on lender repossessions (REOs), the top 10 states with the largest annual increases were Colorado, Florida, Minnesota, Alabama, Texas, California, Arizona, Virginia, North Carolina, and Pennsylvania. North Carolina is especially important in this picture because it appears in the top 10 and also showed a fast rise in foreclosure activity overall, signaling growing stress in parts of the state’s housing market.

Top 10 Foreclosure States

1. Indiana — up 36.3%
2. North Carolina — up 34.0%
3. Alabama — up 26.6%
4. Mississippi — up 24.6%
5. Minnesota — up 24.2%
6. Georgia — up 23.3%
7. Arizona — up 23.2%
8. Arkansas — up 17.7%
9. Colorado — up 16.3%
10. Missouri — up 14.2%

North Carolina stood out in 2026 because its foreclosure activity increased sharply year over year. One midyear report said North Carolina was among the states with the largest annual jumps in foreclosure activity, rising 47% from the prior year among states with at least 500 filings. Another ATTOM-based ranking placed North Carolina at 14th in foreclosure rate for Q1 2026, with 4,141 properties and a rate of 1 in every 1,182 housing units.

The broader 2026 pattern is that foreclosure activity rose across the U.S., reaching a six-year high in inventory rate and posting strong year-over-year gains in filings and starts. The strongest foreclosure pressure was concentrated in Florida and Texas for volume, while several smaller states ranked high on rate. North Carolina’s rise is notable because it suggests growing stress in a large Southern housing market that is important to any top-10 discussion.