Survey Says Children Suffer Most From Ongoing ... - Bankruptcy

While recent statistics reveal that the pace of home foreclosure activity is on the decline, the lengthy foreclosure crisis has had a long-lasting effect on the nation?s children, according to a recent report from the Wall Street Journal.

In addition, the foreclosure of more than five million homes since 2007 has had a negative impact on people who were able to keep their homes, as their home values plummeted thanks to neighborhoods gutted by creditors.

And, despite news that the foreclosure crisis may be dissipating, experts still expect three to five million foreclosures in the next few years.

Children Suffer from Home Foreclosure

According to a recent report from the Center for Responsible Lending, one out of every 10 homeowners in the United States is seriously delinquent or facing foreclosure. This has had a terrible impact on the country?s children for several reasons:

• Displacement of families. Sources indicate that eight million children will ultimately be affected by the foreclosure crisis. This figure includes both children of homeowners who lost their homes and children of renters who were evicted when they weren?t able to afford their rent. The state with the biggest problem is Nevada, where almost 20 percent of children have been adversely affected by foreclosure.
• Effects of foreclosure on kids. According to Julia Isaacs, an analyst at the Brookings Institution, children are the ?invisible victims? of the foreclosure crisis because the loss of their homes can foster emotional trauma, missed days at school, a loss of nutrition, and fewer trips to a family doctor.
• Other effects. In addition to the developmental difficulties faced by children during foreclosure, shuttered homes can increase crime in their neighborhoods, and the loss of home equity can force many parents to dip into their kids? college savings plans in order to find a new place to live.

Stopping Home Foreclosure Through Chapter 13 Bankruptcy

So, stopping your home from being foreclosed could offer a wealth of benefits to young children. The trick, however, is to stop the foreclosure in the first place.

By filing for Chapter 13 bankruptcy, many homeowners have been able to stop the foreclosure process and keep their homes out of the hands of creditors.

In Chapter 13, homeowners are given a set period of time in which they can attempt to catch up on their mortgage payments. If, at the end of the three to five year payment program, the homeowners have made consistent payments, the remainder of their debt may be forgiven.

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