Foreclosures Can Be Chaotic For Children Many economists see little relief from the mortgage crisis before 2013, predicting prices and values will remain low over the next two years. The loss of a home, and the months of worry before the bank takes over, can be deeply traumatic for families.
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Foreclosures Can Be Chaotic For Children

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Foreclosures Can Be Chaotic For Children

Foreclosures Can Be Chaotic For Children

Foreclosures Can Be Chaotic For Children

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  • <iframe src="" width="100%" height="290" frameborder="0" scrolling="no" title="NPR embedded audio player">
  • Transcript

Many economists see little relief from the mortgage crisis before 2013, predicting prices and values will remain low over the next two years. The loss of a home, and the months of worry before the bank takes over, can be deeply traumatic for families.


Stephanie Armour, real estate reporter, USA Today
Kathryn L.S. Pettit, senior researcher, Metropolitan Housing and Communities Policy Center, Urban Institute
Melissa Schoonmaker, pupil services and attendance coordinator, Los Angeles Unified School District

TONY COX, host:

This is TALK OF THE NATION. I'm Tony Cox in Washington. Neal Conan is away.

As America's foreclosure crisis grinds on, it becomes challenging to wade through the statistics but not forget that behind the numbers are millions of families that had to pack up their clothes and pictures, move out of their homes and start over.

Foreclosures are difficult enough for adults, but what about the kids? How are they affected by being uprooted so helplessly? A May 2008 study from First Focus predicted nearly two million children would be affected by foreclosure by the end of 2010. Now, economists predict that the foreclosure crisis will be worse in 2010 than it was in 2009. What happens to the growing number of children caught up in this maelstrom?

In a moment, we'll hear three perspectives, starting with USA Today real estate reporter Stephanie Armour, who has been covering the foreclosure story. And later in the hour, NPR senior news analyst Ted Koppel joins us to talk about the cost of the wars in Iraq and Afghanistan and his view that Americans are not sacrificing enough for a nation at war.

But first, we want to hear from the parents who have gone through a foreclosure. What impact did it have on your children? Our number here in Washington is 1-800-989-8255. The email address is And you can join the conversation at our website. Just go to, and click on TALK OF THE NATION.

Stephanie Armour joins us now in Studio 3A. Stephanie, welcome.

Ms. STEPHANIE ARMOUR (Real Estate Reporter, USA Today): Thank you very much. Thanks for having me.

COX: This is really a big story that I don't know gets enough attention, and I know that you have...

Ms. ARMOUR: No, it really doesn't.

COX: Yeah, it really doesn't, and you've been writing about it, very well as a matter of fact, for some time now. Let's begin with this. Give us a sense from what you know of how big an issue, crisis this is, especially for the children.

Ms. ARMOUR: I think it's actually quite a big issue that really has been significantly overlooked both in terms of the research that's being done but also really in the media, as well.

We the most recent study that's been done, in and of itself, is quite old, and it looks at an estimated two million children being affected by the foreclosure crisis. But that study, in and of itself, looks predominately at the subprime loans that were moving into foreclosure.

And at this point, we have more prime loans, which are loans made to creditworthy, prime borrowers that are now going into delinquency. In fact, the whole tenor of the foreclosure problem has changed so that the borrowers today that are going into foreclosure are really middle to high income earners that have lost jobs because on unemployment.

So this is a whole other demographic group of children, children of these parents that are suddenly losing their homes.

COX: But the result is the same, isn't it, whether you're low income or high income.

Ms. ARMOUR: Yeah. It definitely is, but the numbers are far beyond the two million number that was reported before. There are far more children now being affected than there were when that study was first done.

So the magnitude of the problem has only gotten worse. And what you're seeing is children, especially in the Sun Belt states like Arizona, California, Texas, Nevada, that are losing their homes and in some areas whole communities where schools are losing vast numbers of children, schools themselves being closed because so many children are losing homes and having to leave the communities where they've been.

COX: Are you able to put in perspective for us, Stephanie, whether or not these foreclosures are primarily affecting families, or are they, you know, they could be couples or elderly people, for example. But are we really talking about, in the main, families who are hit by these foreclosures, prime or otherwise?

Ms. ARMOUR: Yeah, one of the most recent studies that was done was in May by the University of Arkansas, and it was really telling. It did find that the majority of people who were being hit by foreclosures were couples with children, usually with a small number of children.

So that was quite telling. There were people who had really bought into the housing bubble, quite frankly, who had kind of bought into the housing property prices that were climbing and climbing and kind of gotten a bit overextended. So these were families with children.

COX: Joining us now to talk more about the impact of foreclosure on children is Kathy Pettit, senior researcher at the Metropolitan Housing and Communities Policy Center at the Urban Institute and director of a project examining the effects of foreclosure on children and schools in Baltimore, Washington, D.C., and New York City. She also joins us here in Studio 3A. Kathy, nice to have you.

Ms. KATHRYN L.S. PETTIT (Senior Researcher, Metropolitan Housing and Communities Policy Center, Urban Institute): Nice to be here.

COX: Before you give us some of the results of your study, is there a particular reason that the Baltimore, Washington, D.C., and New York City areas were selected for your research?

Ms. PETTIT: Certainly. The project has been funded by the Open Society Institute, which has their homes in Baltimore and New York, so that was of particular interest. We're also three members of the Neighborhood Indicators Partnership. So we had the data available, as Stephanie allocated, that it's very difficult to figure out the numbers around these, around these problems.

COX: So let's talk about what the problems are, all right, in terms of the children who are impacted by foreclosure. I'm assuming that the biggest thing is being uprooted and having to leave the comfort of your home and your friends and your school.

Ms. PETTIT: We think that there's three ways that kids are affected by foreclosure. First is just the family turmoil. So even before losing your home, the stress that parents are feeling over their financial difficulties, qualitative work has shown greater levels of anxiety and depression among parents going through this problem. So that can happen even before the move is the move actually occurs.

The next one, as you said, is kids have to switch neighborhoods or schools, and that dislocation can affect their educational progress and social development.

And finally, I think that this was alluded to, kids living in neighborhoods or schools where this is affected. So their families may not even be in foreclosure, but they are still being impacted by their surrounding area.

COX: Well, that was a question I was going to ask you because kids moving from one place to another is not a new phenomenon.

Ms. PETTIT: Right.

COX: Is there a quantifiable difference in a child who is moved because of a foreclosure as opposed to just moving from one place to another?

Ms. PETTIT: We don't have enough information about how foreclosure is different from other moves, but we do know from research that frequent mobility does harm kids' educational progress.

So in one study, children with two school changes in two years were half as likely to be as proficient in reading and math.

COX: And it appears from the research that you have done and from the reporting that Stephanie has done that it's about to get worse...

Ms. PETTIT: Definitely.

COX: we begin a new school year.

Ms. PETTIT: Right, right. And I think in our study so far, which are three central cities, so it wouldn't necessarily represent some of the Sun Belt areas or the suburban areas, 25 to 40 percent of the foreclosures had public schoolchildren, which is the group we're looking at.

But some of these are multi-family buildings that may have dozens of kids in one building that goes under foreclosure.

COX: Is there anything we're identifying what the problem is, and we know that it's not a good thing, but are there any kinds of, I don't know, programs, or is something being done to help these kids manage through this difficult transitional period?

Ms. PETTIT: So we aren't familiar with any programs that specifically focus on kids in foreclosure, but definitely the number one recommendation we have is to prevent foreclosure, to urge families who are going through this to get help sooner and to seek out counseling, and that would be the biggest impact on the problem.

COX: Are you finding that older children, let's say high school age, middle school, even, who are affected by families who are being foreclosed on, are they being encouraged, forced, required to go and work to help the family?

Ms. PETTIT: I'm not sure about that.

COX: Stephanie, your research, your reporting has shown that you talked about the Sun Belt and the problems that are there, and Kathy has already just talked about the Northeast and the corridor that is there. Are you finding any place where people are handling this better than others?

Ms. ARMOUR: That's a good question. Certainly California has grappled with this. They've had some schools that have been back when I was doing my reporting, I remember that there were some schools that were looking at the issue of whether students that were leaving the district because of a foreclosure should be allowed to remain in the school district not necessarily because they were homeless but because of a foreclosure. At this point, I don't know how that was decided, but that was something that was being discussed.

I know that a number of the psychologists I talked with in California were very much aware of this issue. Whether there were actual programs being done, I don't recall. But it was certainly something that they were seeing and were talking about with - among themselves as this being an issue.

COX: How are you able to identify, and I'll ask both of you to answer this if you can, Stephanie and Kathy as well, how you are able to identify when a child has been displaced because of foreclosure. I mean, they don't have a sign on them that just lets you know. So how do you how is it determined?

Ms. ARMOUR: That's a very good question, and in fact, in a number of school districts, parents are taking really Herculean measures to try and hide that children are being relocated due to a foreclosure because they don't want their students to be forced to leave the school.

In some cases, some of the school districts were actually hiring detectives or putting on their website a phone number that people could call anonymously to report that a child had been relocated out of the district, and the parents were hiding that.

So it's not apparent that that's happened, and it's something people were trying to hide.

COX: Is that part of your research, also?

Ms. PETTIT: Our local schools do have homeless coordinators that are supposed to reach out and identify kids, but as you said, there's a lot of stigma around there.

That is one of the local actions that we think could be taken, to have the counseling agencies and the housing and service providers connect with the school officials so that there is less stigma and more communication between these two systems that are helping the families so that the counseling agencies could send out flyers about help to parents through the school system or have a foreclosure prevention fair at the school gym, things like that that could reduce the stigma and let parents know that getting help is the most important thing they can do.

COX: I would think that there's a lot more that could be researched, and I'm assuming that you're going to take up that mantle.

Ms. PETTIT: Yes, we're only through the first part of our study now, which really just describes how many children, and demographics, where they are, concentrations. But our next part of the study is most interesting. It will look at where the families move, which I think is a question that nobody really has an answer to. Are they able to stay in the same neighborhood, et cetera?

COX: All right, I want to thank you both for coming in. I'd like you to stick around a little bit longer, Kathy. We're going to continue the conversation. Stephanie, thank you for being with us, as well.

Stephanie is a real estate reporter for USA Today, and we're talking about foreclosures and how they affect children. If you are a parent, tell us what you're doing to help your children through the crisis. I'm Tony Cox. It's TALK OF THE NATION from NPR News.

(Soundbite of music)

COX: This is TALK OF THE NATION from NPR News. I'm Tony Cox.

As the foreclosure crisis continues, more and more families are finding themselves displaced. But how are children reacting to being uprooted from their homes due to foreclosure?

Parents, if you've dealt with this issue recently or in the past, call us and tell us your story. Our number is 800-989-8255. Our email address is And you can join the conversation at our website. Go to, and click on TALK OF THE NATION.

In a few moments, we'll talk with a school administrator who works to ensure homeless children stay in school. Joining us right now again is Kathy Pettit. She is senior researcher at the Metropolitan Housing and Communities Policy Center at the Urban Institute. Nice to have you again.

Ms. PETTIT: Thank you.

COX: So hold on. Let's take a phone call and see what our listeners are saying. This first one is from Richard(ph) in Oakland not Richard, Claudia(ph) in Denver, Colorado. Claudia, welcome to TALK OF THE NATION.

CLAUDIA (Caller): Hi, thank you for having me.

COX: Thank you.

CLAUDIA: My story goes back to 1985, when we were in - I mean in a crisis here in Denver with foreclosures. What I want to say is is that we could fill in the blanks if you ask me some questions, but it's 25 years later after this experience, with a high school senior, and we weren't allowed to rent the house back for 10 months, until he graduated.

The residual effect 25 years later that this foreclosure had on my son and my family is still - we're still feeling it. It has not, it's you know, it's not in the it's not right now, up front, but what we went through to try to save the house, I didn't need a loan. I mean, I needed the interest rate to change. What I hear now today or what I read, as far as people seeking to refinance, seeking to stay in their homes, I was one that basically qualified that I could, but HUD had such stringent qualifications or whatever I didn't fall into.

We tried to keep the child in the school, which he did get to stay in the school. The school wasn't a problem. But there's HUD signs all over the home. As an adolescent, he had to see the signs that, you know, that HUD took our home.

COX: So Claudia, was it an embarrassment? Is that what you are saying, it was such an embarrassment and a scar on him that 25 years after the fact, he still feels it?

CLAUDIA: Embarrassment I don't know because I'm not speaking for him, but I'd say yes.

COX: All right, thank you for that call. I would imagine, Kathy, that that's something that would be not so unusual for children.

Ms. PETTIT: Yes, definitely, and I think that that's something that parents will need to recognize, as this will affect younger children different than older children.

But one study showed that one school change during the high school years reduced the chance of graduating by 50 percent, and more mobility, frequent mobility, did result in increased levels of behavior problems. So you can see how that could last, have long-lasting effects.

COX: This is a perfect segue to our next guest. Joining us from NPR West is Melissa Schoonmaker. She is pupil services and attendance coordinator for the Los Angeles Unified School District, where she is responsible for making sure the district's homeless students stay in school. Melissa, welcome to TALK OF THE NATION.

Ms. MELISSA SCHOONMAKER (Pupil Services and Attendance Coordinator, Los Angeles Unified School District): Thank you for having me.

COX: Did you hear the last caller, Melissa?

Ms. SCHOONMAKER: Yes, I did.

COX: I imagine, although homelessness is not the same, necessarily, as being foreclosed on, I imagine that those kinds of stories are the very ones that you must deal with on a daily basis in your job.

Ms. SCHOONMAKER: That is very accurate, and I think the impact on children is incredible. And it runs the gamut from, you know, behavior issues to how they do in school to just how they feel about themselves in their situation, their self-esteem and everything.

COX: What do you do when you're in a position like yours in a school district, a public school district, where you have these children who are displaced, and they need to be educated, and they have no home? What kind of a program, what kind of a support can you offer them and do you offer them?

Ms. SCHOONMAKER: Yes, our program is based off of, out of the McKinney-Vento Homeless Assistance Act, which is part of No Child Left Behind. So every school district has to have a liaison such as myself, and we are charged, the district is charged to removing the barriers to that child's educational success.

So we want to make sure that anything that they need to remain in school, to succeed in school, that they have access to. So...

COX: Go on. Finish your answer.

Ms. SCHOONMAKER: Oh, sorry. So I was going to say for us, we make sure they have backpacks, school supplies, clothing if they need assistance with that, transportation to stay at their school, if that's what they need. And of course we help with school enrollment and then connecting with a variety of resources in the community to address, such as the issues as you have been discussing today.

COX: I want to go to a phone call, but before I do, I have another question for you, Melissa. It's this: How do you prevent these students from being identified as having been displaced because of foreclosure or because of homelessness?

Ms. SCHOONMAKER: So they're not stigmatized?

COX: Yes.

Ms. SCHOONMAKER: We have, in our enrollment packets, we have a student residency questionnaire, which goes into every enrollment packet at all of our schools. And you know, Los Angeles Unified is very large.

We also ask our schools to share that questionnaire every, you know, once a year, maybe when the emergency cards go out, so that families who have been in this situation can be identified.

But we also keep I mean, it is a very confidential situation. So we ask each school to have a liaison that we train at their school site who can connect. We train them, and then they can connect the student to the resources that they need and somebody who can sit down and talk with the parents confidentially about their situation and make sure that if the parent want to share that information with the teacher, that's the person who's sharing it.

I mean, obviously, teachers, you know, would benefit from knowing this information, but it is very stigmatizing at times, and so we want to make sure that we take really diligent care with all, with what we've as we work with a family to make sure they're comfortable with the steps that are being taken to help their child.

COX: This is TALK OF THE NATION. We are talking with Melissa Schoonmaker, who is pupil services and attendance coordinator for the L.A. Unified School District. Also joining us, Kathy Pettit, senior researcher at the Metropolitan Housing and Communities Policy Center at the Urban Institute.

We are talking about foreclosure and children and the impact that it has on them. If you'd like to join the conversation, you can call us at TALK OF THE NATION, 800-989-8255. The email address, Let's go to a caller. Joni(ph) is going to join us right now from Schertz, Texas. Joni, welcome to the program.

JONI (Caller): Oh, thank you. We're in a three-generation family, and we are leaving because of a foreclosure due to a reverse mortgage that we inherited that was so ridden with debt, we just could not handle it, and we did not know about it.

Any rate, things that we are doing is that we're going to have to move soon. So we're making sure for the three-and-a-half-year-old child that his bed goes with him, his blankets go with him, his special toys and that where there'll be friends that we can, hopefully we can travel back and see.

But it's very hard to find another place because every time they look in the application, oh, you went through foreclosure, well, you don't pay your bills. You know, I explained to them, I even got a letter from the attorney that we didn't know this was coming. How could we be ready for it?

So but I'm you know, and we're sitting down last night at a family conference, and we're going to do the same thing for ourselves, take our beds and take some special things.

COX: Joni, thank you very much for the call, and good luck to you. She talked about children, and we've all been discussing them. Let's hear from a person who was a child. I don't think I don't know whether this person is still a child or not, I'm assuming not. This is Edie(ph) from Flint, Michigan. Hello. Is it Edie or Eddie(ph)?

EDIE (Caller): Edie.

COX: Edie, are well, I'm assuming you're an adult now, and you were going to tell us your story?

EDIE: Well, I'm only 18. So this is pretty recent. But I did just recently experience the effects of foreclosure on my family and especially on my younger sister, I just, it was upsetting to see the way that it affected her.

She had a rough time with school, and it was hard on both of us, the embarrassment of, you know, when people ask why you're moving, you have to, you know, either not answer or explain that it's because of foreclosure.

EDIE: It was hard. It was something that made me feel sad, and it's something that I want to make sure I never experience or cause in my own family in the future.

COX: Edie, how did you, if I can ask this, how did you cope? What did you do to tell yourself, to steel yourself so that you could get through this?

EDIE: I just, you know, a lot of it was taking my mind off it. A lot of it was being thankful that I've or grateful that I was able to, we were able to find another house, even if it is just a rental.

You know, we do have a roof over our heads so - and although, I, you know, lost my childhood home and a lot of the memories that came with it, you know, we weren't - we didn't have it as bad as some people did but...

COX: Well, we have Melissa Schoonmaker on the air with us, who's a pupil services and attendance coordinator for the L.A. Unified School District. Melissa, maybe we can help Edie. What would you say to her? What can you tell her that would be of help?

Ms. SCHOONMAKER: Well, I think - I mean, I'm sorry that that has occurred for her. I was - I hope that - I would hope that she would be able to share some of the information with the personnel at the school in a way that they would be able to help advocate for her and provide resources for the family related to, you know, whether it's counseling or assistance with Department of Public Social Services or referrals to foreclosure information. I mean, I would, you know, schools have a variety of resources right at their fingertips. And if we, as a community, collaborate together, we can really work wonders for these families who are going through such a trying time.

COX: Thank you for that, Edie. Thank you, Melissa, for that. Would you want to add something to this, Kathy?

Ms. PETTIT: I think this just shows how the different paths that this could take. If homeowners have trouble finding a new place because they have damaged credit or renters who are given no notice and don't know their homes are being under foreclosure, if they can be rehoused quickly, then the impacts are much -are likely to be much less than if this could lead to greater housing instability, sleeping with friends or eventually homelessness.

COX: We have an email I'd like to share with you. It comes from Michele(ph) in Gloucester, Mass. We have been foreclosed upon recently and have lost our house. My 5-year-old and I moved in with my parents who are not wealthy, so we all chip in. I told her we would be working hard to get our own place, either renting or buying. She was happy living at Grandma's and said why would I want to leave here? So I suppose the point that I'm making with this email, Melissa Schoonmaker, is that extended family becomes very important in a circumstance like this, doesn't it?

Ms. SCHOONMAKER: Yes, it does. We have a lot of our families who are in transitional situations wind up being doubled or tripled up with friends or relatives. And I think those connections are just phenomenal for them, and such a support to not wind up in a more dire circumstance such as being on the street or in a shelter or living in your car.

COX: You're listening to TALK OF THE NATION from NPR News.

All right, let's take another caller. This is John(ph) from St. Paul, Minnesota. Hello, John.

JOHN (Caller): Hello.


JOHN: Can you hear me?

COX: You're on the air, yeah. I can hear you.

JOHN: Yeah, we have a unique situation that happened to us over the last seven years where we actually were foreclosed on. I don't want to go into the story about what it was. We basically take responsibility for that. But what happened to us after that was more of a nightmare because we moved into a rental property. We were served by the sheriff with papers that that was being foreclosed on after six months. Not doing my diligence on the next house, we found out that we were being foreclosed on again. And basically, we moved our children within six years over four or five times.

Now, we're sturdy. I mean, we're steady now because we've moved into a contract for deed. Our credit is rebuilding. But one of the things my wife and I both turned in to is our relationship, and secondly to stand in the community we're involved with, and being honest with our kids about what was going on with the whole deal. And so that helped us a lot. Their grades did okay in school. The community helped us a lot. We never - we use it as an educational experience with how it happened to us and how we kind of rebuilt.

And so, you know, the boys are great. We got kids from all the way from high school down to kindergarten, and it actually - just last year, it was kind of neat because our middle child came to us and said, you know, it was an experience, and that's what he chalked it up as.

COX: Well, John, thank...

JOHN: So it was like bad (unintelligible).

COX: Thank you for that call. I would think, Kathy Pettit, that what John is describing is something that we haven't really talked much about, and that is the stress between spouses in the household and the kids not seeing that on top of, you know, the losing of their residence.

Ms. PETTIT: Yes, there was qualitative interviews from the National Council of La Raza that documented just that amongst Latino families in particular, increased spousal arguments and stress in the family, and that's definitely going to affect the kids.

COX: Melissa, I would think also in Los Angeles, because the L.A. Unified School District, which is - I don't know - somewhere between 600 and 700,000 students, and it's primarily Latino. Are you finding that there are any ways to connect the behavior of students to their ethnic backgrounds? Do different groups respond differently to this?

Ms. SCHOONMAKER: You know, we haven't really looked at it that way. We've looked at teaching our - looking at - talking to our teachers about having red flags, you know, possible behaviors they may see and then really looking at, you know, ways to connect the family with the resources that we have at the schools and in the community.

So as far as ethnicity, I mean, I couldn't - I would feel not just saying, you know, tying it to one specific ethnicity that these things happen or how kids behave in a certain way.

COX: Because you're in California and because we all know about the cash-strapped situation that the state is in, particularly the public school system that you work for, are you finding it more difficult to offer services to students who need them like these when the district is running - it needs some services itself?

Ms. SCHOONMAKER: Yes, but, you know, we have an amazing community relationship, and it just seems that every time one door seems to close, then another door opens for us. And we've made tremendous gains in outreach and partnerships. So for us, it really is a community effort to serve these kids, and I think it's great because we open up a lot of different resources for the families by doing so.

COX: Are you optimistic in terms of your ability then to provide the services that are needed? And this will be my last quick question for you.

Ms. SCHOONMAKER: I think I have to be. I mean, we have a lot of - we have 12,500 kids that we've identified in our district at this time, and, you know, we know that number is going to grow. And so, we always search out ways to meet their needs the best that we can.

COX: My final thing for you, Kathy, is, briefly, are you optimistic also based on the research or are you thinking we're heading down a really dark road here?

Ms. PETTIT: There are millions of children that are going to be affected in the next couple of years, but - so I think that we can - if we work to address the problem now, we can prevent some further harm later to the children.

COX: Kathy Pettit is senior researcher at the Metropolitan Housing and Community Policy Center at the Urban Institute and director of a project examining the effects of foreclosure on children and schools in Baltimore, Washington, D.C., and New York. Melissa Schoonmaker, pupil services and attendance coordinator for the L.A. Unified School District. Thank you both very much.

Coming up, Ted Koppel talks about what he calls the lack of sacrifice Americans are making while the U.S. is engaged in wars in Iraq and Afghanistan. I'm Tony Cox. It's TALK OF THE NATION from NPR News.

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