This story was originally published by Public News Service.
By Terri Dee, producer
Public News Service
March 23, 2026
Indiana is known for its relaxed, family-friendly environment. However, the state has gained another distinction: the highest foreclosure rate in the nation.
The foreclosure process involves a lender taking the home after a homeowner stops their mortgage payments. To recoup the outstanding loan balance, the home is sold, often as-is. Research site ATTOM showed in 2025, one in 1,600 Indiana households filed for foreclosure.
Amy Nelson, executive director of the Fair Housing Center of Central Indiana, said there is at least one clear reason why.
“From the feedback that we have gotten from people who are going through the foreclosure process or people that work with those going through the foreclosure process, it is definitely rising escrow costs,” Nelson explained. “Your mortgage might not be going up but your home insurance and your property taxes are.”
Adding to the issue, wages are not keeping up with costs and consumers face higher prices for their purchases, leaving smaller budgets for housing.
Nelson pointed out Hoosier renters are the most cost-burdened. The National Association of Home Builders said in 2025, nearly half of Indiana’s nearly 813,000 renters paid 30% or more of their income on rent and utilities.
Data gathered by Fair Housing of Central Indiana indicates a substantial number of foreclosures among people who have been in their homes for 10 years or more. After a foreclosure is finalized, the former homeowner often becomes a renter. Nelson describes another troubling trend in central Indiana’s housing market.
“When our foreclosures go to auction, unfortunately, these are more likely to be the homes that are picked up by investors – particularly, out-of-state investors – who then flip these former owner-occupied homes into expensive rentals.”
When it happens, the auctioned homes do not give former owners any new financial opportunities, Nelson added. The Fair Housing Center’s report showed Hamilton, Hancock, Hendricks, Johnson and Marion counties have the largest number of homes owned by out-of-state investors.
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