North Carolina’s Pre-Foreclosure Rates in 2024: Fewer Filings but Lingering Strife for Homeowners

A Look Beyond the Numbers into the Reality of Default

In the early autumn of 2024, a quiet tension ripples through neighborhoods in North Carolina. Behind closed doors, bills go unopened, conversations over dinner turn anxious, and kitchen counters gather collections of final notices. While the statistical outlook for pre-foreclosures in the state shows signs of stabilization, the hardship remains deeply personal for thousands of homeowners caught in a worsening confluence of economic obstacles — rising inflation, elevated interest rates, and a stubborn housing affordability crisis.

According to the latest figures, North Carolina recorded 690 pre-foreclosure filings in September 2024. That’s a modest 1.32% increase from August, when 681 properties entered the early stages of foreclosure. From a surface-level glance, that increase might signal little more than seasonal fluctuation. But to understand what’s truly at play, it’s critical to contrast these numbers against recent historical data and the lived realities behind them.

What’s striking is that the 690 pre-foreclosure filings in September 2024 represent a 35.7% decrease from the 1,073 recorded in September of last year, a sharp drop that, at first blush, points to progress. And yet that progress comes with caveats.

A Decade-Long Rollercoaster: Peaks, Dips, and a Pending Reckoning

To appreciate the present, it is necessary to revisit the past. From the mid-2000s housing bubble to the post-pandemic era, North Carolina’s pre-foreclosure history has echoed national trends—skyrocketing during the 2008 housing crash, peaking in 2011 with nearly 40,000 pre-foreclosure filings, then slowly retreating over the following decade. In 2020 and 2021, government forbearance programs and moratoriums on evictions and foreclosures allowed the rates to plummet to historic lows.

But that reprieve didn’t last. By 2023, pre-foreclosures in the state surged again to 14,596, driven in part by the expiration of COVID-era relief measures and an inflationary drag on household income. This year, as of September 2024, the cumulative number stands at 5,383. If this trend holds — and there’s every reason to believe it might — the state is on pace to see just over 7,000 pre-foreclosures filings by year’s end.

Still, while statewide filings are comparatively low, the crisis for individual families is no less severe. The difference now is that these households are navigating a mire of different economic forces than the ones witnessed during the Great Recession — this time, the swing factor is affordability.

Life at the Edge: Families Grappling with Foreclosure in North Carolina

Take Maria Thompson, a single mother raising two children in the Charlotte suburbs. She works full-time as a nurse’s aide, a demanding job that pays barely more than it did five years ago. Rent prices have shot up; food costs, up again last month; and her adjustable-rate mortgage just reset at double the original interest rate.

“I tried to refinance last year, but my credit took a hit when I missed two car payments,” Maria said. “Now they’re telling me I can’t qualify, and I’m falling further and further behind.”

Maria first received a notice of default in July. She’s part of a growing demographic: working-class homeowners caught in the middle of wage stagnation and soaring living costs. Add to that the rising cost of utilities and insurance premiums especially in flood-prone counties of eastern North Carolina and foreclosure is no longer a threat reserved for those on the economic margins; it’s a reality creeping steadily into the working middle class.

Inflation and Interest Rates: The Unseen Drivers of Pre-Foreclosures

What’s different today compared to the early 2010s is the subtlety of the crisis. Banks are not issuing as many high-risk loans; there’s less of the subprime chaos that once defined the housing collapse of 2008. Instead, families are slipping into foreclosure more slowly, almost invisibly, worn down by steady erosion rather than sudden collapse.

Consider inflation: while it has cooled compared to its pandemic highs, it remains stubborn, especially in essentials like groceries, car repairs, and healthcare. The Federal Reserve’s effort to tame inflation through interest rate hikes has kept mortgage rates hovering near 7%, locking many homeowners into monthly payments they thought they’d never see.

This blend of rising costs and difficult refinancing conditions has left families unable to sell, unable to refinance, and increasingly unable to stay.

Conclusion: Stability on Paper, Instability in the Streets

If there is a narrative to draw from North Carolina’s 2024 pre-foreclosures data, it is one of diverging realities. The numbers, on paper, seem to point to progress. But for thousands of North Carolinians dealing with the emotional and financial weight of possibly losing their home, the crisis is alive, evolving and deeply isolating.

Communities will need more than monthly declines in foreclosure statistics to regain stability. They will need targeted assistance, affordable housing options, and a financial system that recognizes how quickly real life can unravel and how long recovery takes.

Until then, homeowners like Maria and Jamal continue to wait for relief in mailboxes that bring little more than fear.