The Fallout of the Foreclosure Crisis

Buying a house you couldn't afford, accepting a subprime mortgage from a lender, losing your job, or experiencing health problems are just a few of the reasons that people can end up in foreclosure. Regardless of the reason for their money troubles, thousands of people are losing their homes, damaging their credit, and facing the possibility of homelessness. While foreclosure can clearly have a huge impact on economic health, they can also threaten a person's mental well-being. Depression, anxiety disorders, divorce, and violence are just some of the more insidious aftershocks that can be felt in communities all around the country.

As homeowners struggle to cover their mortgage payments, utility bills, childcare costs and food bills, the accompanying tension and anxiety can wear down a person's ability to cope. Prolonged periods of stress and hardship can quickly turn into an anxiety disorder or to full-blown depression.

Depression is often characterized by physical and mental fatigue, lack of ambition, sadness, and worst of all—hopelessness. This lack of hope can make it extremely difficult to look at one's situation with a clear head. Feelings of shame and failure can overwhelm a person and convince her that the situation will never get better. Negative thoughts can ambush her psyche, dispensing blame and criticism at every turn. She may think "I failed. Here's proof that I can't take care of myself. I'm a disappointment and a loser."

Depression can also cause inaction. If a person has lost her job or has other personal problems mounting on top of the foreclosure, she may simply stop trying to pick up the pieces, and let the dark cloud wash over her. Her destructive thoughts will inhibit her ability to deal with her problems head-on. If she needs to find a better paying job or look for a place to live, the task may seem monumental. This paralysis inevitably leads to worse financial problems, leading to lower self esteem. Her reduced self esteem only makes it that much harder to move onward and upward, and so the cycle continues.

There's also embarrassment and the feeling that no one will want to help her. Believing that she doesn't deserve to be helped, she doesn't contact the bank for assistance. She then misses the window of opportunity to save her home.

Along with depression, struggling homeowners may find themselves turning to food, alcohol or drugs to deal with the stress. Others will turn to gambling with the hopes that they will win enough money to get the house back. These self-destructive behaviors of course only exacerbate the problem, and can have a huge impact on families.

Anxious children, marital spats, separation, and divorce are all common side effects of the foreclosure problem. Unfortunately, things can escalate quite quickly from partners simply blowing off steam, to full-on domestic violence.

As the number of foreclosures continues to rise, the number of abuse cases quickly follow suit. One national survey has cited "financial issues" as a major contributing factor to the increase in violence in homes across America, and Brian Narney from the National Network to End Domestic Violence said that the financial stress in an economic crisis is "not a cause of domestic violence, but it can intensify it."

While some people turn their frustration outward, others turn on themselves. With no hope on the horizon, some homeowners choose to end their own lives rather than endure any more pain.

There have already been a few cases of suicide attempts among homeowners facing foreclosure, including a 91 year old woman from Ohio who shot herself before facing eviction. There was also an Oregon couple who were days away from losing their home when they killed themselves and their three dogs via carbon monoxide poisoning.

A study conducted in Australia has determined that "economic trends are closely associated with suicide risk, with men showing a heightened risk of suicide in the face of economic adversity." A California psychologist also noted that "one's house is very much a projection of one's self. To have a home taken away is tantamount to having part of yourself taken away."

The picture is indeed bleak, but it doesn't have to be. There are options available for homeowners who are struggling to make their mortgage payments, such as refinancing or getting an extension on their loan. If you're facing possible foreclosure, it's critical that you contact your lender right away. As for taking care of your mental health, there are resources available to help. See the continuation of the article, titled "Dealing with the Emotional Aftermath of Foreclosure" for more information.