1. 1 Social Impacts of Foreclosure Foreclosures in Wisconsin: Responses and Resources for Living Beyond the Bubble November 5, 2009 Robin Smith The Urban Institute

2. 2 Social Impacts of Foreclosure This presentation Impacts on families Impacts on neighborhoods Challenges and priorities

3. 3 Impacts on families Displacement Housing Instability Financial Insecurity and Economic Hardship Personal and Family Stress

4. 4 Displacement Where Do Households Move? No systematic information Homeless system survey Reduction in Housing Quality Decline in household resources Rental housing more expensive than comparable owned housing Quick decisions often mean poor choices

5. 5 Housing Instability First Step on Unstable Housing Path Patterns for low-income households Homelessness Hard Hit Groups The very old The very young

6. 6 Financial Insecurity Homeowners Devastating loss of wealth Credit ratings shattered One estimate, takes 10 years to recover Renters Lose security and other deposits Incur costs of housing search and moving Move may lead to less-affordable situations

7. 7 Financial Hardship Financial implications gloomy but do not evoke economic hardship for all families Selected Hardship Measures Food Stamps Social service caseloads Personal bankruptcy Hardship for Older Americans Particularly hard hit Limited amount of time to overcome setback Rely on housing investment to fund retirement years

8. 8 Personal and Family Stress Disrupted Relationships Family turbulence Exacerbates negative behaviors such as child abuse and addiction Marital problems and domestic violence Mental Health Physical Health

9. 9 Impacts on Neighborhoods Social breakdown in neighborhoods Household turnover Physical deterioration Decline in property values Increase in crime

10. 10 Challenges and priorities Addressing the crisis overall—need policies to: Prevent foreclosures of current mortgages Help displaced families recover Prevent similar crisis in future What do we need to know? Very little documentation let alone formal evaluation Where are families? What do they need? What works? Recognize the many social consequences Identify especially vulnerable populations Acknowledge applicability of existing strategies