Montana’s Preforeclosure Rates Drop Sharply in May 2025, but Financial Pressures Persist for Homeowners

A Statewide Decline in Filings Masks a More Complex Reality

In May 2025, only 16 Montana homeowners were reported to be in pre-foreclosure—a sharp 48.4% drop from the 31 filings in April and a 20% decrease from the same period last year. On paper, this decline suggests growing stability in a housing market historically vulnerable to cycles of boom-and-bust. But dig even a little deeper, and the data tells a more nuanced—and in some ways, troubling—story.

Despite the monthly drop in filings, economic pain continues to simmer beneath the broad-stroke numbers. The reduction in formal preforeclosure actions may reflect temporary protections, loan modifications, or community intervention programs. It is not necessarily a sign that Montana’s most vulnerable homeowners are out of danger.

In interviews with housing counselors and homeowners across the state, stories of rising costs, unemployment, and diminishing savings paint a portrait of families living on the edge, where a missed paycheck or a sudden repair can tip the balance from solvency to potential homelessness.

A Long-Term Look: From Crisis to Calm—and Back Again?

To understand what these 16 pre-foreclosure filings really mean, consider their place in the arc of Montana’s recent housing history.

More than a decade ago, Montana—like the rest of the country—felt the ground shake under the weight of the Great Recession. In 2009 and again in 2010, the state recorded over 2,400 pre-foreclosure filings annually. The crisis reached its peak in 2010 with 2,633 filings, part of a national mortgage meltdown that disproportionately affected working-class families and rural homeowners who lacked the safety nets of urban financial infrastructure.

By 2019, pre-foreclosure numbers had dropped to just 62. In 2022, there was only one filing in the entire year. These numbers hint at a recovery, though one often powered more by policy interventions—like statewide foreclosure moratoriums during the COVID-19 pandemic—than by durable economic change at the household level.

In 2023, things began to shift again. That year brought a noticeable uptick, with 493 filings. Although the figure represented barely a fifth of 2010’s peak, it marked the beginning of a reversal. Families who had relied on emergency stimulus funds and mortgage forbearance had begun running out of options.

Pre-foreclosures dropped again to 232 by the end of 2024, and through May 2025, officials have recorded only 99 cases. While the downward trend offers cautious optimism, many Montanans still face uneven progress.

When Pre-Foreclosure Is Just the Tip of the Iceberg

Lisa Jensen, a single mother in Great Falls, has not received a pre-foreclosure notice yet. But she’s three months behind on her mortgage, juggling part-time shifts at a retail store alongside gig work when she can find it. “It’s like I’m floating in a life raft,” she says. “Every time I think I’ve got a grip, something new punches a hole in the boat.”

Lisa’s experience illustrates an invisible threshold in housing data: many families don’t end up in pre-foreclosure because they find ways—legal or otherwise—to delay the process. They borrow from relatives, dip into small retirement accounts, or negotiate informal forbearance plans with lenders.

And while pre-foreclosure is technically just the beginning of the foreclosure process, it often signals financial distress months or even years in the making, especially in rural communities where economic recovery has lagged behind urban centers.

Affordability, Inflation, and a Shrinking Margin of Safety

The current decline in filings suggests that fewer Montana homeowners are on the official threshold of losing their homes. But mortgage counselors across the state say the number of “technically current but highly distressed” families remains significant.

Increases in food, gas, and utility prices—especially heating costs during long Montana winters—have left many homeowners resorting to high-interest credit cards to cover their monthly obligations. Mortgage payments, once the highest monthly expense for many, are now just one of many bills competing for limited household funds.

Meanwhile, Montana has undergone a housing affordability crisis of its own in recent years. The influx of remote workers post-pandemic, particularly to cities like Bozeman and Missoula, drove up property values and strained housing supply. Low-income homeowners, many on fixed incomes or working hourly jobs, were left clinging to homes suddenly surrounded by high-cost developments and rising property taxes.