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The Impacts of Foreclosures on Families and Communities: A Primer

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Document date: July 01, 2009
Released online: July 01, 2009

The text below is an excerpt from the complete document. Read the full report in PDF format.


The foreclosure crisis is now having dramatic effects throughout America. In mid-2008, recognizing that this phenomenon was still quite new, the Open Society Institute asked the Urban Institute to scan available research to document what we know about: (1) the way foreclosures impact families; (2) how foreclosures affect communities; and (3) the efforts now underway, or being suggested, to address the crisis, focusing on actions at the local level. This report summarizes a longer report presenting the results of this review.


This decade may well turn out to be the most tumultuous in the history of U.S. housing markets. The period from 2000 to 2006 saw an unprecedented acceleration in home prices almost everywhere, and homeownership expanded markedly as access to subprime loans and other factors made it much easier for lower-income families to purchase a home of their own. Then it all fell apart. Prices in most regions have since plummeted and foreclosure rates have increased dramatically. Almost all American communities are affected, but levels of foreclosure are much higher in some neighborhoods and metropolitan areas than others.

Recognizing that this turnabout was still quite new, in mid-2008 the Open Society Institute asked the Urban Institute to scan available research to assess what we now know about the way foreclosures impact families and communities and about policies and programs suggested or underway to prevent or mitigate those impacts. The results of this work have been documented in a separate report1 and elements have also been made available on a new web site, http://www.Foreclosure-Response.org. In addition, it was felt that this companion piece would be valuable: a brief overview that enables readers to get a sense of the full story quickly—impacts and response strategies—and then identifies sources where they can find more complete information on topics that are of special interest to them.

Local practitioners and advocates who want to play a role in responding to the crisis are the primary audience for this work.

  • They may use information about the potential harm to children, the elderly, neighborhood safety, and local property tax revenues to raise public awareness and build local support for action.
  • This information can also be used to engage organizations—like schools, child welfare agencies, or police departments— that might not otherwise see the foreclosure crisis as relevant to their mission.
  • And information about response strategies being developed in other areas can help them design strategies appropriate to their own cities and neighborhoods.

(End of excerpt. The entire report is available in PDF format.)

Topics/Tags: | Families and Parenting | Housing

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