Maryland Short Sales & Foreclosures: Q2–Sep 2025 Update

Maryland’s distress market is moving—but not spiraling. The newest reports show measured, data-driven shifts that buyers, sellers, and agents should understand as we head into year‑end.

Bottom line: filings are up year over year, short sales ticked higher off a small base, and county-level pressure remains concentrated around the Baltimore metro and Prince George’s County. If you’re deciding between loan mod, short sale, or riding it out, the facts below will help you choose the right lane.

The signal in the noise: five stats worth watching

1) Foreclosure filings are up YoY, but context matters. Maryland recorded 3,398 total foreclosure filings in Q2 2025, a +15.5% year-over-year increase. That’s meaningful, but it’s not a wave; it suggests a steady normalization from ultra-low pandemic levels rather than a sudden shock.

2) Monthly momentum nudged higher into summer. New foreclosure filings hit 565 in June 2025, up 10.8% month over month. Nearly half came from Prince George’s County, Baltimore County, and Baltimore City, reinforcing a long-standing geographic pattern: distress concentrates where affordability is stretched and household budgets are sensitive to rate and price changes.

3) Short sales rose—but remain a small share of sales. Maryland recorded 23 short sales in June 2025, up 53.3% from Q1. As a share of all sales, that’s around 0.34%—still a sliver of the market. Translation: short sales are increasing from very low levels, which creates opportunities in individual transactions without defining the overall market.

4) Mid-summer ranking looked elevated… In July 2025, ATTOM ranked Maryland 3rd‑worst foreclosure rate nationally, at 1 filing per 2,566 housing units. That put the state on watch lists and likely contributed to an uptick in investor and servicer activity.

5) …but early fall improved. By September 2025, Maryland’s rank improved to #11 with 768 filings (about 1 in 3,314 housing units). Top counties by rate were Caroline, Charles, and Baltimore City. That month-to-month drift reminds us not to over-read any single print; trends matter more than headlines.

What this means if you’re a homeowner

• If your monthly payment is unsustainable, start the conversation sooner rather than later. Lenders generally offer more options when you’re early. If selling makes more sense than modifying, a well-run short sale can cap losses and avoid a foreclosure mark. If you need a playbook for timelines, net sheets, BPO challenges, or escalation routes, here’s how we handle short sale approval assistance day-to-day.

• Expect more documentation, not less. Investor rules (FHA, VA, GSE, and portfolio guidelines) continue to evolve. Clean packages and clear hardship narratives still drive outcomes. If your file involves junior liens, HOA arrears, tax liens, or solar/UCC filings, plan your release strategy early—the first-lien approval window is not the time to start searching for contact info.

• A short sale is not a fire sale. The “discount” is determined by the investor’s net-proceeds math, property condition, and market comps—not by arbitrary percentages. Market-accurate pricing is the fastest way to approval.

What this means if you’re a real estate agent

• Pipeline planning: With filings up YoY and short sales inching higher off a small base, you’ll likely see more “maybe short” scenarios at listing appointments. Screening for hardship, reinstatement feasibility, and second-lien complexity saves weeks later.

• Time is the currency. Faster approvals come from clean, proactive files: complete packages, correct third-party auths, repair photos, and valuation notes prepared in advance of the BPO. If you’d rather keep your energy on pricing, showings, and offers, we specialize in helping real estate agents close short sales faster—handling lender calls, escalations, value disputes, and lien releases behind the scenes while you stay front-of-house with the client.

• Offer strategy: Buyers can account for third-party fees (including short-sale facilitation) in their offer price and, in some programs, request seller-paid closing costs. The goal is a bank-approved net that works—without killing the deal structure.

Direction of travel (not doom)

• Direction: Up modestly YoY on filings; monthly prints fluctuate, and rankings eased by September.

• Short sales: Increasing from a low base; still a small share of total transactions.

• Takeaway: Prepare, don’t panic. The best outcomes still come from early planning, accurate pricing, and organized packages.

If you’d like a candid look at timelines, approval odds, and net-to-lienholder math for a specific property, start your short sale with a quick intake (no obligation).

Source notes: Maryland DHCD “Housing Beat,” Q2 2025 (foreclosure totals, monthly new filings, short-sale counts). ATTOM Foreclosure Market Reports, July 2025 and September 2025 (state ranking, rate per housing unit, county leaders).