North Dakota Pre-Foreclosures Rise Sharply: The Growing Strain on Homeowners

A Slow-Moving Crisis is Accelerating

In September 2024, 22 homes across North Dakota entered pre-foreclosure, a relatively small number on paper, but one that conceals a much deeper undercurrent of financial strain. It marks a 4.76% increase over August and a staggering 46.67% increase compared to September of last year. These numbers reflect not just a statistical rise, but a mounting crisis for homeowners quietly slipping through the cracks in one of the nation’s smallest housing markets.

The homes in question span every kind of person: teachers, oilfield workers, retired veterans, and single moms. People like Linda M., a 63-year-old retired postal worker in the western plains, who has spent the past four months dodging calls from her lender while trying to stretch her fixed income through another winter. “I never thought I’d see this happen,” she said. “I paid into my house for 18 years. Now I’m afraid I won’t live in it for nineteen.”

Linda’s story is echoed across the state, not always loudly, but with undeniable frequency. The latest data shows that 2024 is on track to surpass the highest pre-foreclosure filings ever recorded in North Dakota, with 195 cases logged through September. If the trend continues, this year could close with more than 260 filings, topping the previous record of 248 in 2023.

The Pandemic Pause is Over. The Bills Are Due.

During the height of the pandemic, emergency relief measures such as foreclosure moratoriums, forbearance programs, and stimulus checks created a buffer, temporary, but effective, for the most vulnerable homeowners. In 2020 and 2021, reported pre-foreclosures dropped to 92 and 55, respectively.

But that pause is long over. And for many families, the return to “normal” brought with it not a recovery, but a reckoning.

Since 2022, North Dakota has experienced a resurgence in pre-foreclosure activity. Filings more than doubled that year to 116 and then more than doubled again in 2023. That acceleration has carried into 2024. While some of the factors are national, record inflation, interest rate hikes, and stagnant wage growth, the consequences are deeply local.

“There’s this assumption that people out here are hardwired to survive downturns,” said Gabriel Schultz, a housing counselor who has worked in the state for over a decade. “But survival is not the same as stability. And right now, stability is eroding, one family at a time.”

The Human Cost of a 46.67% Year-Over-Year Jump

It’s easy to let percentages numb the reality. A 46.67% year-over-year rise from September 2023 to September 2024 means seven more homes entered pre-foreclosure during that window. Seven may not seem like much. But in a sparsely populated state like North Dakota, each one is significant.

Take the case of Erik and Malia S., a young couple who moved to the state in 2019 for work in the energy sector. After Erik was laid off in 2022, the couple struggled to keep up with their adjustable-rate mortgage, which had jumped nearly $300 this year when the interest rate reset. Now they’re behind on three payments and have just received a notice of default. Their future is uncertain. “We’ve applied for every job, every program,” Malia said. “But we’re a paycheck behind the problem.”

For many low-income homeowners, the problem isn’t always overspending or poor planning, it’s that the gap between income and basic survival grows thicker and more unforgiving every month.

Data shows that the spike happening in North Dakota is part of a larger national trend that experts fear may get worse before it gets better. Inflation may have cooled slightly in 2024 compared to recent highs, but groceries, gas, utilities, and rent remain elevated. Homeowners on the edge are being pushed over it, especially if they are already living paycheck to paycheck.

From Historical Stability to Accelerated Risk

Historically, North Dakota has had one of the most stable housing markets in the country. Between 2005 and 2014, pre-foreclosure filings rarely rose above single digits annually. It wasn’t until 2015 that noticeable shifts in mortgage distress began to emerge, with filings jumping tenfold that year to 51 and rising steadily through 2019.

At its current pace, 2024 could become the worst year ever for pre-foreclosure in North Dakota.

Despite the rising cases, comprehensive data remains frustratingly limited. County and city-level breakdowns are not publicly available, making it difficult to trace the geography of distress. But activists who work with struggling homeowners report that rural and semi-rural areas, once more insulated from the kinds of sharp price spikes seen in metro housing markets, are becoming increasingly vulnerable. In these communities, a job loss or medical bill doesn’t just strain budgets; it can break them.