Loss Mit Services

Connecticut Foreclosures Are Down 31 Percent. Here’s Why That Isn’t the Good News It Sounds Like.

Posted on 14. Sep, 2026 by ctlms in Blog

Agents keep asking me some version of the same question: "Is the foreclosure wave here yet?" Everybody's been reading the national headlines, and the national headlines say foreclosures are climbing. So I pulled the numbers for Connecticut, and the answer is weirder than a yes or a no. It's "no, and that's not the good news it sounds like."

Let me walk you through what the current data actually says, because there's one number in it that changes how you should be handling every listing appointment with a payoff problem.

What do the numbers say?

ATTOM Data Solutions puts out the foreclosure report most of the industry works from. Their Mid-Year 2026 U.S. Foreclosure Market Report, released in July, counted 227,548 U.S. properties with a foreclosure filing in the first six months of 2026. That's a default notice, a scheduled auction, or a bank repossession. Nationally that figure is up 21 percent from a year ago and up 28 percent from two years ago. Foreclosure starts were up 18 percent. Bank repossessions were up 33 percent. So yes, nationally, the trend is up.

Connecticut went the other direction. 1,763 filings in the first half of 2026, which is DOWN 31 percent from the first half of 2025 and down 38 percent from 2024. That works out to 0.11 percent of housing units, or one in every 875. We rank 29th out of 50 states. The most recent monthly report, July 2026, had Connecticut at 323 filings for the month, one in every 4,773 housing units.

So if you've been waiting for a flood of distressed listings to show up on the public foreclosure lists, the data says you're going to be waiting a while. That's the part that sounds like good news.

What's the number that actually matters?

Same ATTOM report, different table. A Connecticut foreclosure that was completed in the second quarter of 2026 had been in the foreclosure process for an average of 1,626 days. That is about four and a half years. It's the fourth longest timeline in the country, behind Louisiana, Hawaii and New York. The national average is 563 days, and nationally that number has been dropping for seven quarters in a row. Ours hasn't really moved.

Why is Connecticut so slow? Connecticut is a judicial foreclosure state. The bank can't just post a notice and hold an auction the way they can in Texas, where the average is 155 days. They have to file a lawsuit, serve the homeowner, get through the court's Foreclosure Mediation Program if the homeowner is an owner-occupant and elects it, get a judgment, and then either a strict foreclosure with law days or a foreclosure by sale with a committee auction. Every one of those steps has a calendar attached to it, and every one of them can get continued. I'm not knocking the process. It gives homeowners real protection. But you need to understand what it does to the numbers on the file.

So what does a four-and-a-half-year timeline do to a file?

Here's the part nobody explains to agents, and it's the reason I wanted to write this one. During a foreclosure, the payoff does not sit still. It grows. Every single month.

1. Missed payments keep accruing. The homeowner isn't paying, but the loan is still amortizing on paper and every missed payment gets added to the balance owed.

2. Default interest and late charges pile on top. Most notes carry a higher interest rate once the loan is in default, and the late fees are monthly.

3. The servicer advances the taxes and insurance. The mortgage servicer is the company you send your payments to. When there's no payment coming in, they pay the town and the insurance company out of their own pocket to protect the collateral, and every dollar of that gets added to what the homeowner owes.

4. Attorney fees and foreclosure costs. The bank's foreclosure attorney bills the file for every filing, every appearance, every mediation session. Title work, appraisals, property inspections every month to make sure the house is still standing. All of it goes on the payoff.

So then you ask, "how much are we talking about?" It depends on the loan, but I'll give you a made-up round number to make the point. A seller who was $15,000 underwater on the day the lis pendens was recorded is not $15,000 underwater in year three. They may be $50,000 or $60,000 underwater, and the house has had three more years of deferred maintenance on top of it. The gap gets wider the longer it sits.

Why does the bank care about that?

This is the part that makes the whole business work, so pay attention. The banks don't do short sales to help people. They do short sales to help themselves. The investor who actually owns the loan, whether that's Fannie Mae, Freddie Mac, HUD, or a securitized trust, is running one calculation: what do we net if we approve a sale today, versus what do we recover if we carry this thing through four more years of Connecticut foreclosure, pay the attorney the whole way, take the house back, and then sell it as an REO in 2030?

When the answer favors the sale, the file gets approved. When it doesn't, it gets denied. That's it. That's the whole decision, and the 1,626-day timeline is a big thumb on the scale, because every year the bank has to carry a Connecticut file is another year of cost they'd rather not eat. I am not telling you that means your file will be approved. Nobody can tell you that before the valuation is ordered and the net is calculated, and I wrote a whole post last week on why. What I'm telling you is that the incentive exists, it's real, and it's bigger in Connecticut than almost anywhere in the country.

What does this mean for you at the listing appointment?

Put the two numbers together. Filings are down 31 percent, so the public lists are thin. Timelines are four and a half years, so the sellers who ARE in trouble have been in trouble for a long time, quietly, and their payoff has been growing the whole time.

Those sellers are not showing up on a foreclosure list you can buy. They're showing up in front of you. They're the expired listing that never got a price reduction because the price was already at the payoff. They're the relocation seller carrying two payments. They're the divorce where neither side can refinance. They're the estate where nobody has made a mortgage payment since the funeral. The lis pendens might be two years old, or it might not have been filed yet.

So here's the best practice. Ask about the payoff before you price it. Get the mortgage statement, and if there's a second mortgage or a home equity line, get that one too. Ask when the last payment was made. If the payoff plus closing costs is anywhere near the realistic list price, stop and call somebody before you sign the listing, because the standard playbook is going to fail and it's going to fail slowly.

The takeaway

Connecticut's foreclosure numbers are low, and they're going to stay low for a while, and that has nothing to do with whether your seller is in trouble. It has to do with how long the process takes. Fewer filings, longer timelines, bigger payoffs. The problem is still there. It's just quieter.

Send me the address and the approximate payoff. I'll tell you within a day whether it's worth pursuing.

As always, feel free to reach out to me with any questions.

Sean Wilder
Loss Mit Services
860-265-3727
CT Debt Negotiator NMLS #828273
Loss Mit Services is a dba of Accredited Home Services, LLC · CT Debt Negotiation License DN-828273

“The Bank Will Never Approve It” — Why Nobody, Including Me, Can Promise You a Short Sale Approval

Posted on 08. Sep, 2026 by ctlms in Blog

I hear two sentences about short sales from agents, and on the surface they sound like opposites. The first one is "the bank will never approve it," usually from an agent who got burned once and swore off the whole category. The second one is "don't worry, we always get them approved," usually from somebody trying to win the referral. Here's the thing I want you to take away from this post: those are the same sentence. Both of them are a guess dressed up as a fact. Nobody can tell you in advance what a lender is going to do with a file, and after more than 2,000 of these I'm including myself in "nobody."

So then you ask, "Sean, if you can't promise an approval, what exactly am I referring my client to?" That's a fair question, and the answer is worth understanding, because once you know WHY the promise is impossible, you get very good at spotting the people who make it anyway.

Who is actually saying yes?

Start here, because it's the thing most agents have backwards. The company your seller mails the payment to is the mortgage servicer. In most cases the servicer does not own the loan. An investor does. That might be Fannie Mae, Freddie Mac, HUD on an FHA loan, the VA, or a securitized trust with a name nobody can pronounce. The servicer's job is to run the file against that investor's guidelines and, on a lot of files, send it up for the investor's sign-off. Who owns the loan is the first thing you need to know on any short sale, because it tells you whose rules you're playing by.

And those rules are not "does this seem reasonable." They're a box. The file either fits in the box or it doesn't, and a big part of what we do all day is try to make the homeowner's real circumstances fit into the box the best that we can.

What's in the box?

Strip away the paperwork and every short sale decision comes down to three questions.

1. Does the hardship fit? The investor wants to see a reason the borrower can't keep paying or can't bring money to closing. Job loss, divorce, a death, a medical event, a relocation, an unaffordable payment. Different investors accept different hardships and want them documented different ways, but there has to be one, and it has to be real.

2. Does the valuation support the offer? After the offer goes in, the servicer orders its own opinion of value, an appraisal or a broker price opinion depending on the loan type. The offer gets measured against that number, not against the list price and not against what the buyer thinks the house is worth. If the valuation comes back high, the offer gets countered or denied no matter how clean everything else is.

3. Does the net beat foreclosing? The investor compares what they'll clear from this sale against what they'd expect to recover if they foreclosed, took the house back, held it, and sold it themselves. The banks don't do short sales to help people. They do short sales to help themselves, and only when that comparison says so.

Now look at the order those things happen in. The valuation gets ordered AFTER the offer is in. The net gets calculated AFTER the valuation comes back. The investor's answer comes last. So anyone who tells you the result before the offer exists is promising something they have not seen yet. They don't have the valuation. They don't have the net. They don't have the investor's decision. What they have is a sales pitch.

Isn't "the bank will never approve it" the safer bet, then?

No. It's the same guess pointed the other direction, and in my experience it usually traces back to one bad experience with one servicer a long time ago. Times have changed. Files with a real hardship, a market-priced offer, and a complete package get approved every single day. We see it literally every day. What I cannot do is tell you which day, or whether your seller's file will be one of them, until the file is actually built and the valuation is back.

And there's a cost to the pessimistic guess that agents don't always see. When you tell a homeowner "the bank will never approve it," they hear "there's nothing to be done," and the next stop is a foreclosure that might not have been necessary. That's not you being cautious. That's you making a promise about the bank's decision that you're in no position to make, just a negative one.

So what CAN I tell you?

Plenty, and quickly. Before a file is ever opened, I can look at the loan type, the lienholders, and the rough numbers and give you a straight answer on three things:

1. Whether the loan type has a workable path. FHA, VA, conventional, and USDA all have their own short sale programs with their own requirements. Some are more predictable than others.

2. Whether the lien stack is survivable. A quiet second mortgage, a tax lien, an old judgment, an HOA balance. Junior lienholders have to be dealt with too, and some of them are a lot harder to deal with than the first mortgage.

3. Whether the numbers are in a range worth opening a file over. If the payoff is so far above realistic value that no investor's math will ever work, I'll tell you that, and I'd rather tell you now than in month four.

That's an honest answer. It's also a better one than a promise, because I've watched what happens to the seller who was promised an approval. They're the ones who walk in month three when the counter comes back, because nobody prepared them for the possibility. The seller who heard "here's the process, here's the real timeline, and here's what can go wrong" is the one who stays in the deal.

While I'm being honest about timelines: a short sale typically runs 4 to 6 months from start to close, and the lender's approval alone commonly takes 90 to 120 days before you even get to the closing window in the approval letter. If somebody quotes you two months, that's the same old playbook as "we always get them approved."

The takeaway

"The bank will never approve it" and "we always get them approved" are both guesses, because the three things that decide a short sale, the hardship, the valuation, and the net, don't exist until after the offer is in. Nobody can promise the result. What a good negotiator can do is tell you, up front and fast, whether the file is worth opening and what's likely to be the hard part.

So the next time someone tells you they always get them approved, ask them a simple question: how, exactly, do you know that before the valuation has been ordered? Then send me the address and the approximate payoff. I'll tell you within a day whether it's worth pursuing.

As always, feel free to reach out to me with any questions.

Sean Wilder
Loss Mit Services
860-265-3727
CT Debt Negotiator NMLS #828273
Loss Mit Services is a dba of Accredited Home Services, LLC · CT Debt Negotiation License DN-828273

The Expired Listing That Was Never Actually Priced — Why the Cuts Stopped at the Payoff

Posted on 31. Aug, 2026 by ctlms in Blog, Foreclosures, My Blog, News, Real Estate, Short Sale, foreclosure

I want you to try something this week. Pull up your expired listings from the last year — yours, or the expireds you’re prospecting — and look for one specific pattern: the house sat for months, took two or three price reductions, and then the reductions just stopped. Not at a round number. Not at a market number. At a very specific number. And if you go look up the mortgage balance on that property, you’ll find out exactly why the cutting stopped where it did.

I see this constantly, and most agents walk right past it.

Why do price reductions stall at a weird number?

Because that listing was never priced to the market in the first place. It was priced to the payoff.

Here’s how it happens, and no one in the transaction is being dishonest — it’s just incentives doing what incentives do. The seller owes what they owe. When the agent sits down at the listing appointment and suggests a price, the seller does the math in their head: list price, minus commission, minus conveyance tax, minus the payoff… and if that math goes negative, they can’t sign. They don’t have the money to bring to closing. So every pricing conversation on that listing quietly hits a floor, and that floor has nothing to do with what buyers will pay. The agent may not even realize it’s happening — the seller just keeps saying “I can’t go any lower than that,” and the agent hears a stubborn seller instead of an underwater one.

Then the market votes. Showings slow down, feedback comes back on price, the reductions start — and they stop cold the moment the next cut would put the seller underwater at the closing table. The listing rides out the rest of the agreement at a price the market already rejected, and it expires.

The market doesn’t care what the seller owes. And the seller can’t take what the market is offering. That gap has exactly one fix, and it is not another six months on the MLS at the same number: somebody has to negotiate with the lender.

So then you ask, “why would the bank ever take less than they’re owed?”

I get this question every single time, and the answer is the most important thing in this whole post: the banks don’t do short sales to help people. They do short sales to help themselves.

When a lender evaluates a short sale, they’re running a math problem. On one side: approve the sale today and take the net proceeds. On the other side: foreclose, pay the legal costs, wait out the process, take the property back, pay to secure and maintain and insure it, then sell it as a bank-owned property — usually in worse condition than it’s in right now, because vacant houses don’t age well. When they run those numbers, the approved short sale frequently nets them more. That’s the entire reason the process exists. Nobody at the bank is doing anyone a favor — they’re protecting their own recovery, and the homeowner and the agent happen to benefit from it. I’ve worked on thousands of these files and I can tell you the lender’s math is the engine of every single one.

What do you actually say to that expired seller?

This is where the expired listing becomes a referral trigger instead of a dead lead. The homeowner has usually concluded the house “can’t sell.” That’s not what happened. The house couldn’t sell at a price that clears the debt. Those are two different problems, and the second one has a process. A few things to keep straight when you have that conversation:

1. Be honest about the timeline. A short sale typically runs 4 to 6 months from start to close, and the lender’s approval alone commonly takes 60 to 120 days before you even get to the closing window in the approval letter. If someone tells you short sales wrap up in a couple of months, they’re working off a very old playbook. The seller who hears the real timeline up front stays in the deal; the one who was promised a fast close walks in month three.

2. Make no promises about approval. Nobody can guarantee a lender says yes — not me, not anyone, and you should be suspicious of anybody who talks like they can. What an experienced negotiator can do is look at the loan type, the lienholders, and the numbers, and tell you whether the file is worth opening. That’s an honest answer, and sellers respect it.

3. Keep the seller current on their obligations to their lender. Nothing in this process involves ignoring the servicer or the mail. Whether and how a seller pays anything is between the seller, their lender, and their own advisors — the short sale conversation is about resolving the debt through a sale, not avoiding it.

4. Know what you’re checking before the appointment. The payoff versus realistic value is the whole ballgame. If you can get even an approximate mortgage balance and compare it against what the price history already told you about value, you’ll know whether you’re walking into a normal relisting or a short sale before you ring the doorbell.

And one thing NOT to do: don’t relist it at the same price and hope. The market already voted. Hope is not a pricing strategy.

Why the agent who explains this usually gets the relisting

Think about what that homeowner has heard so far: months of silence, then an expired notice, then a stack of postcards from agents promising better marketing. You’d be the first person to walk in and correctly name the actual problem — the debt, not the marketing. In my experience the agent who says “your house didn’t fail, your payoff is bigger than your value, and there’s a process for that” is usually the one holding the new listing agreement when it’s over. Not because of a slicker presentation — because they told the truth about a problem everyone else misdiagnosed.

The takeaway

An expired listing where the payoff exceeds any realistic list price is not a failed listing. It’s a short sale that never got started. The tell is sitting right in the price history: reductions that stall at a suspiciously specific number. Find those files, check the balance, and have the honest conversation — real timeline, no promises, a process instead of a diagnosis of failure.

If you’ve got one of these — expired, price cuts that stopped cold, a payoff that doesn’t fit the value — send me the address and the approximate payoff. I’ll tell you within a day whether it’s worth pursuing.

As always, feel free to reach out to me with any questions.

Sean Wilder
Loss Mit Services
860-265-3727
CT Debt Negotiator NMLS #828273
Loss Mit Services is a dba of Accredited Home Services, LLC · CT Debt Negotiation License DN-828273