Foreclosures take an emotional toll

home with foreclosure sign

Millions of Americans have lost their homes, and neighborhoods and communities have suffered since the U.S. housing bubble began to burst in 2006.

Studies have shown there is a connection between a housing downturn and a decrease in community health. Political scientist Julia Lynch, the Janice and Julian Bers Assistant Professor in the Social Sciences, joined with Craig E. Pollack, formerly a Robert Wood Johnson Foundation Clinical Scholar at Penn, to see exactly how public health is faring in the current crisis, and found people have been affected both physically and economically.

For their study, the researchers gave 250 people undergoing foreclosure counseling at the Consumer Credit Counseling Service of Delaware Valley between July and September of 2008 a written survey to fill out after completing their first intake visit.

Participants were asked how often they had experienced particular kinds of feelings—such as helplessness and anxiety—over a two-week period. Lynch and Pollack utilized the standard Patient Health Questionnaire depression scale (PHQ-8) to assess the answers.

They compared the results to a random sample of about 10,000 Philadelphia area residents who took part in the Philadelphia Health Management Corporation’s 2008 telephone survey.

Lynch and Pollack found that nearly 50 percent of participants reported having depressive symptoms and 37 percent met the screening criteria for major depression.

Lynch says they were surprised at the number of people suffering from depression. Nationwide, about 13 percent of people living in poverty meet the screening criteria for major depression “and here we were looking at rates almost three times that for this population,” she says.

Although there are anecdotal reports of suicide among those facing foreclosure, Lynch says they are more concerned about the effect depression has on a person’s long-term health and ability to work proactively to solve problems.

People who are threatened with foreclosure are asked to be diligent about seeking out information, gathering documentation, finding counseling and maintaining a strict household budget. Yet, Lynch says, “It’s just not possible to do that when you’re suffering from depression.

“Depression is likely to make mortgage counseling a lot less effective, and counseling is really one of the main policy weapons that has been brought to bear on this crisis so far,” she says. “If 37 percent of people are so depressed that they’re really not able to benefit from this counseling, that’s a big problem.”

Lynch says foreclosures can also degrade the social and physical infrastructure of neighborhoods and hurt tax revenues for municipal and state governments. When homes go into foreclosure, people typically don’t pay property taxes. As foreclosures drive down the value of neighboring homes, tax revenues from those homes drop, too.

“At the same time as you have an increasing need for social services and policing in these neighborhoods, you have a declining ability of governments to provide these services because their tax revenues are declining,” says Lynch.

To help address this looming health crisis, Lynch would like to see more doctors and healthcare providers ask patients about housing and connect them with mortgage counseling resources. She says they are hoping to test interventions to determine whether providing doctors with a checklist of questions and information sheets about available resources results in people receiving mortgage counseling.

The federal government is beginning to acknowledge the health aspects of the housing crisis. Lynch and Pollack recently returned from Washington, D.C., where they spoke at the Department of Housing and Urban Development about their findings and potential policy solutions.

“We know at least HUD is thinking about it,” she says. “My guess though is that it’s going to take awhile for the message to get through to all of the various levels of government that the mortgage foreclosure crisis is really also a health crisis, and then to figure out what to do [about] it.”

Originally published on October 1, 2009