Foreclosure: It's Not Just about the Mortgage

What's causing all the foreclosures-which now affect one in 92 households? Loose lending practices? Exotic mortgages? Borrowers who overbought? Predatory mortgage brokers, real estate agents and banks? Those low, low interest rates brought to us by Alan Greenspan?

They all played their part in the recent epidemic, but Harvard law professor Christopher T. Robertson and two other researchers found another factor.

In a preliminary study of 2000 homeowners facing foreclosure in four states (California, Florida, Illinois and New Jersey), say researchers, 49% said that they had lost their homes in part because of a medical problem. Of that group, 32% had suffered an illness or injury, 23% had unmanageable medical bills 27% lost work due to a medical problem and 14% had to care for sick family members. Another surprise: The survey revealed that only 17% of the homeowners surveyed had no health insurance. "Our most striking observations [write authors] begin with the realization that most of those suffering medical foreclosures are solidly in the middle class, with apparently affordable homes, and health insurance to boot." What people need is not just access to health insurance, they argue, but insurance that's adequate to their needs, in other words, policies without large co-pays and deductibles and low lifetime limits. Other musts: insurance that covers medical disabilities and greater coverage of home care-or failing all that, insurance that would pay the mortgage when there was a medical crisis in the household.