Vermont Posts Lowest Foreclosure Rate in Nation

Vermont recorded the country's lowest foreclosure rate in August, with state starts down 14% from last year through September.

Updated on Nov. 9, 2026 in Residential

Vermont Posts Lowest Foreclosure Rate in Nation

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Vermont had the lowest foreclosure rate in the country in August 2026, with one foreclosure for every 67,808 housing units. As of the end of September, 426 Vermonters had begun the foreclosure process this year, a 14% decline from last year.

Why it matters

The state's low rate contrasts with a 13% national rise in foreclosure filings, which had one filing for every 3,569 housing units. Vermont's relatively low foreclosure activity reflects both a state foreclosure mediation program created after the 2008 crash and steady homeowner equity.

Vermont's foreclosure rate was one per 67,808 housing units in August, compared with one per 3,569 nationally. Vermont does not track how many foreclosures have been completed, so the number of homes actually lost is unknown.

The players

Vermont Department of Financial Regulation

The state agency that tracks foreclosure data in Vermont and does not currently record completed foreclosures.

The details

About 79% of mortgaged Vermont homes carry loan balances no more than half of estimated value, compared with about 41% nationally. Vermont created a foreclosure mediation program after the 2008 housing crash and recession that lets homeowners meet with lenders or servicers before losing a home.

2008: Housing crash and recession prompt Vermont's foreclosure mediation program.
During the pandemic: Many homeowners lock in mortgage rates of 3% or less.
August 2026: Vermont records the lowest foreclosure rate in the country.
End of September 2026: State data shows 426 foreclosure starts this year.

Seasonal Patterns

Vermont's current low foreclosure rate follows its post-2008 foreclosure mediation program, which was designed to keep homeowners in their homes during the housing crisis. Nationally, filings rose 13%, suggesting Vermont's trend runs against the broader foreclosure cycle.

Vermont homeowners with low loan-to-value ratios have more equity to draw on if payments become difficult. Residents who fall behind should know that the state's mediation program offers a chance to meet with a lender or servicer before losing a home.

The takeaway

Homeowners who have built equity can use it as a buffer, and anyone facing payment trouble should look into Vermont's foreclosure mediation program early. Early contact with a lender or servicer gives the most options.