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The Link between Foreclosure and Mental Illness


So far this year, approximately 1.7 million homes have been foreclosed upon in the United States. RealtyTrac recently reported that there were 55% more foreclosures during July 2008 than in July 2007.

Even worse is the news that the rate of foreclosures does not seem to be slowing down and that the possibility of losing one's home may result in physical and psychological distress.

A recent article by The Street discussed the impact that foreclosures can have on the mental health of distressed homeowners.

The poor U.S. economy, rising food and energy costs and waves of mass layoffs across the country have pushed many Americans into bankruptcy, but still millions of homeowners do not seek the protection of the automatic stay that the U.S. Bankruptcy Code provides.

For those people, losing their homes to foreclosure is often the outcome. This can be both financially and emotionally devastating.

The Mental and Emotional Impact of Foreclosure

Financial difficulties and fear of losing a home in foreclosure increases stress levels and may lead to depression, anxiety disorders and self-destructive behaviors.

It is not uncommon for distressed homeowners to experience disruptions in sleep patterns or to begin to display other uncharacteristic traits.

While the symptoms of a mental illness may be subtle or hidden in some people, others may act out and cause further losses by damaging professional and personal relationships.

Even more tragic are the cases in which foreclosure has driven people to suicide.

Foreclosures and Suicide

Bend Weekly reported a sad case last October in which a foreclosure led to the apparent suicide of a man and his wife in Oregon. Along with the bodies of the man and his wife, the bodies of the couple's four Golden Retriever dogs were found.

The Associated Press reported another case in which a mortgage foreclosure resulted in suicide.

In Taunton, Massachusetts, police say that a woman was so distressed over the foreclosure of her family's home that she fatally shot herself with her husband's high-powered rifle. Just before the suicide, the woman sent a fax to her mortgage company stating that by the time they foreclosed on the home, she would be dead.

A note found near the woman's body instructed her husband and son to use her life insurance policy to pay for the house. The victim had always managed the mortgage payments and household finances and her husband reportedly had no idea that the house was headed into foreclosure.

How to Deal with Foreclosure

Dr. Charles Nemeroff, chairman of psychiatry at Emory University in Atlanta, Georgia and president of the American Foundation for Suicide Prevention, told ABC News that stress is a huge factor in suicide.

Since financial problems can cause a great deal of stress, there is grave concern that the sinking economy and foreclosure crisis could spawn more thoughts about suicide.

Experts say that distressed homeowners should always keep in mind that there are often many options to deal with foreclosure, even when it may seem like there is little hope.

Some people are able to save their homes by filing bankruptcy.

Others may be able to negotiate manageable payment arrangements with the lender, or get a short-term loan to avoid foreclosure.

The housing bill that was just passed by Congress and signed by President Bush will also assist some homeowners by allowing them to refinance their risky mortgages into fixed-rate mortgages that will be backed by the federal government.

Foreclosure and other financial difficulties are only temporary problems, regardless of the outcome, and there are many constructive ways to deal with this problem as opposed to doing something drastic to one's self.

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