Hennepin, Ramsey counties brace for uptick in mortgage foreclosures after low rates during pandemic

Hennepin County set up a team to monitor the expected onslaught of foreclosures as homeowners became unemployed or sick when the pandemic struck more than two years ago.

Much to their surprise, a wave of foreclosures never came in Hennepin County or across the Twin Cities. In Ramsey County, last year’s 72 foreclosures was the lowest number since 2003.

Housing officials credit the federal foreclosure moratorium and soaring home prices for the lack of people forced from their homes. In some cases, the strong housing market kept property values high, allowing owners falling behind on payments to sell at a profit.

Now the moratorium has expired, interest rates are rising and economists are raising fresh concerns about a recession that could spark a new round of foreclosures.

“It will be interesting to see if there will be an upswing,” said Ramsey County Assessor Luis Rosario. “I suspect there will be.”

Hennepin County’s figures for the first six months of 2022 signal that mortgage foreclosures are on the rise. So far, the county has logged 154 foreclosures compared with 173 for all of 2021.

“With the health of the job market and property values, I don’t think we will see foreclosure numbers like in years past,” said Ryan Allen, a professor of urban planning at the University of Minnesota and a member of Hennepin County’s foreclosure team.

Nearly 50% of this year’s foreclosures are in Hennepin County’s core cities of Minneapolis, Brooklyn Center and Bloomington. There are few cities throughout the county that haven’t had closure action on a property, like Mound, Dayton and Maple Grove.

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