South Carolina posted the worst foreclosure filing rate in the country in August, knocking Florida out of the top spot, and three of the state's metro areas now rank among the five hardest-hit markets nationwide.
Data from ATTOM, the real estate analytics firm, show South Carolina recorded one foreclosure filing for every 1,547 housing units in August, a rate that outpaced every other state in the country. Nevada came in second at one per 1,920 units. Florida, which led the nation in foreclosure activity during the first half of 2026, dropped to third at one per 2,397 units, the Daily Mail reported. Texas and Maryland rounded out the top five.
Nationally, 40,277 properties had foreclosure filings in August, a category that includes default notices, scheduled auctions, and bank repossessions. That figure was up 1 percent from July and 13 percent from a year earlier.
The metro-level numbers paint an even sharper picture. Columbia, South Carolina's capital, posted the highest foreclosure rate of any metro area with at least 200,000 residents: one filing for every 1,232 housing units across its roughly 378,275-unit market. Spartanburg ranked third nationally at one per 1,262, and Charleston-North Charleston placed fifth at one per 1,501.
Punta Gorda, Florida, separated the two South Carolina metros at second place with one filing per 1,249 units. Fayetteville, North Carolina, slotted in fourth at one per 1,458.
The rest of the top ten: Lakeland-Winter Haven, Florida (one per 1,549); San Antonio-New Braunfels, Texas (one per 1,556); Las Vegas-Henderson-Paradise, Nevada (one per 1,584); Cape Coral-Fort Myers, Florida (one per 1,646); and Stockton-Lodi, California (one per 1,758).
Three Florida metros still made the top ten, but the state's grip on the worst-in-the-nation title is gone, at least for now.
Why South Carolina? Ben Mizes, president of Clever Real Estate and a licensed real estate agent, pointed to a familiar stack of pressures bearing down on homeowners who were already stretched thin:
"Higher borrowing costs, insurance and property expenses, and broader affordability pressure can all make it harder for financially stretched homeowners to recover once they fall behind."
But Mizes cautioned against reading too much into the statewide number alone:
"A statewide foreclosure rate can signal growing stress, but the local story often comes down to job conditions, home-price changes, investor activity, and how much equity homeowners have available as a cushion."
Nashville broker Steve Jolly, who tracks foreclosure activity, framed the problem more bluntly. The dividing line, he said, is when a homeowner bought and how much skin they had in the deal.
"Buyers from 2019-2021 have real equity. Every loan from 2022 forward is underwater if they put 5 percent down."
Jolly's point cuts to the core of the foreclosure math. A homeowner who bought in 2019 or 2020, when prices were lower and the subsequent run-up padded their equity, can sell the house and walk away from trouble. A homeowner who bought in 2023 at peak prices with a minimal down payment cannot sell for enough to cover the remaining loan balance. When a job loss or a cost spike hits, the first homeowner has options. The second gets a foreclosure notice.
Jolly put it plainly:
"That's the whole story in one line: equity is the escape hatch. A 2019 buyer who loses a job sells the house. A 2023 buyer who loses a job gets a foreclosure notice, because they can't sell for enough to cover the payoff."
Jolly also drew a distinction between what starts the slide and what makes it irreversible. Higher insurance premiums, property taxes, and monthly payments on adjustable or recently refinanced loans push homeowners to the edge. But the absence of equity is what keeps them from climbing back.
"Rising carrying costs are the trigger. Negative equity is what turns a trigger into a completed foreclosure."
That dynamic helps explain why the problem is concentrated where it is. Markets that saw rapid price appreciation followed by stagnation or decline, combined with rising insurance and maintenance costs, are the ones producing the most filings. South Carolina, parts of Florida, and stretches of Texas and Nevada all fit that profile.
Jolly flagged another pattern in the data worth watching. Five of the ten highest-rate metro areas, Columbia, Fayetteville, Charleston, San Antonio, and Las Vegas, are home to major military installations.
"Five of your ten highest-rate metros sitting next to major installations is worth a look."
Jolly stopped short of drawing a firm conclusion, noting the relationship should be tested against VA loan-share data before anyone treats it as causal. But the overlap is hard to ignore. Military families tend to buy on tighter timelines with lower down payments, exactly the profile Jolly described as most vulnerable to foreclosure when prices flatten or dip.
While South Carolina topped the rate rankings, raw volume told a different story. Florida still led all states in foreclosure starts, lenders initiating the process on 3,189 homes in August. Texas was close behind at 3,126, and California came in third at 2,565.
Lenders started the foreclosure process on 25,894 homes nationally in August, up 7 percent from August 2025.
When it came to completed foreclosures, properties that banks actually repossessed, Texas dominated. The state recorded 1,835 bank repossessions in August, far ahead of California's 589. Florida did not even crack the top five for completed foreclosures, a sign that many of its filings may still be working through the legal pipeline.
Among individual metro areas, Houston led the country with 448 repossessed homes. Dallas followed at 402, San Antonio at 256, Phoenix at 186, and Baltimore at 167.
Bank repossessions nationally hit 5,794 properties in August, up 22 percent from July and a striking 42 percent from a year earlier. That year-over-year jump is the sharpest increase in any of the three foreclosure categories ATTOM tracks.
Despite the climbing numbers, ATTOM CEO Rob Barber offered a measured assessment of the national picture:
"While some homeowners are still facing financial challenges, overall foreclosure volumes remain well below historical norms and the broader housing market continues to demonstrate resilience."
That framing is accurate in the aggregate. Current foreclosure volumes are nowhere near the levels of 2009 or 2010. But aggregate resilience is cold comfort to the homeowner in Columbia or Spartanburg who bought in 2022 with 5 percent down and is now watching carrying costs climb while the house is worth less than the loan.
Florida's first-half dominance, a 21 percent jump in foreclosure activity compared to the prior year, already signaled that the Sun Belt housing boom had left real wreckage behind. South Carolina's August surge suggests the damage is spreading, not shrinking.
When the people who played by the rules and bought a home in good faith start losing those homes because costs outran their equity, the question stops being whether the "broader market" is resilient and starts being whether anyone in a position to act noticed in time.