Defaults, Foreclosures Brew Health Crisis Among Older Americans

Statistics have long shown a personal financial crisis may lead to depression that breaks families apart. Add to that mortgage default, foreclosure and the so-called midlife crisis known to affect many people over 50 years old, and a new problem emerges. New data are linking mortgage default to “substantially increased risk” of depression among this particular group of homeowners.

Another statistic appears to be unfamiliar. According to Dawn E. Alley, assistant professor of epidemiology and public health at the University of Maryland School of Medicine, the principal investigator in the study, over 25% of people in mortgage default or foreclosure are over 50, accounting for millions of hopeless borrowers.

A first-of-its-kind long-term survey of the impact the current housing crisis is having on older Americans conducted by the Organized Research Center on Aging at the University of Maryland School of Medicine warns of “a looming health crisis.”

It found that in the wake of rising mortgage delinquencies and home foreclosures this group of homeowners exhibit high rates of depression when they start to fall behind in their mortgage payments and “have a higher likelihood of making unhealthy financial tradeoffs regarding food and needed prescription medications.”

Older homeowners with chronic conditions like diabetes or hypertension are showing health problems that are “short-term consequences of falling behind on a mortgage that could have long-run implications for that person’s health,” Alley said.

Various findings lead to the same conclusion, she said. For example, findings from the Centers for Disease Control and Prevention also show the number of Americans with depression has been increasing along with rising unemployment.

A separate nationwide survey conducted by the University of Maryland showed mortgage counselors are seeing a rising tide of health issues. Almost 70% of these counselors said many of the clients they worked with were depressed or hopeless. What is worse, about one-third of the counselors said they had worked with someone who expressed intent for self-harm or suicide in the last month.

Data pinpoint a somewhat under-the-radar issue that “threatens to become a major public health crisis if not addressed,” said E. Albert Reece, vice president for medical affairs at the University of Maryland and dean of the University of Maryland School of Medicine.

He called on the government and private policy makers to take into consideration these findings as they work to meet “the health and economic needs of Americans.”

Previous research on affordable housing and the impact of homeownership associate homeownership with better health while financial strain tends to deteriorate health and increase death rates.

The researchers said they examined data from a nationally representative panel study of Americans older than age 50 and answers given in 2008 by 2,474 participants to a survey that included questions designed to measure psychological impairment, general health status and access to important health-relevant resources.

Asked if they had fallen more than two months behind on mortgage payments since 2006, of the participants who were delinquent, 22% developed elevated depressive symptoms over the two-year period compared to only 3% of non-delinquent respondents.

Similarly, 28% of mortgage-delinquent participants reported food insecurity compared to 4% in the non-delinquent group. In addition, 32% of delinquent homeowners reported much higher levels of cost-related medication non-adherence compared to 5% from the non-delinquent.

Alley suspects that since the survey started when the mortgage crisis was in its beginnings, their health picture today must be much worse due to rising mortgage defaults driven by unemployment. The housing crisis may be making existing health disparities worse, she said, because minority groups “had poorer health, lower incomes and higher levels of debt even before the current mortgage crisis.”

Especially lower-income African-American and Hispanic homeowners who were at higher risk of foreclosure have lost significant wealth during the housing crisis. And since these losses tend to affect their entire communities, minorities are disproportionately affected and “it will likely take decades” for them to recover declining home values and lost tax revenue.

“These are very serious and clearly ongoing issues,” Alley said.

The study, “Mortgage delinquency and changes in access to health resources and depressive symptoms in a nationally representative cohort of Americans older than 50 years,” was published online by the American Journal of Public Health in October.