May 1, 2008
A new report released by First Focus reveals that an estimated 2 million children will be directly impacted by the subprime mortgage crisis as their families lose their homes due to foreclosures. As the first comprehensive analysis of how the crisis will impact kids, the report explains that this number will rise even higher when accounting for other populations, such as children being evicted from rental units that are going into default and those children whose parents default on conventional loans. These foreclosures will happen primarily during 2008 and 2009.
In addition, the report finds:
- Due to the increasing number of foreclosures, school districts across the country are experiencing increases in the number of homeless children entering their classrooms;
- Children impacted by the mortgage crisis are likely to experience excessive mobility and as a result are only half as likely to be proficient in reading as their peers. Moreover, they are much more likely to be held back and eventually drop out of school;
- Children forced from their homes experience behavioral problems, such as increases in violence;
- The physical and mental health of displaced children can be severely compromised, as families losing their homes are less likely to have money available for items such as health care and health insurance.