Financial Illiteracy One of the Roots Causes Of Foreclosure Crisis

Posted in Foreclosure Crisis, November 13th, 2008 |

Financial illiteracy is one of the root causes of foreclosure crisis. Realizing this, a movement is taking shape among the social workers of America who are tuning themselves to address primarily the woes of foreclosure victims. Largely they became gullible victims of predatory lending because they could not understand the basics of budgeting income.

Social workers debuted during the end of the 19th century and the have mainly worked for the poor. But today in this Foreclosure Age where credit card woes are rampant many social work education centres are focusing on those who are economically vulnerable. The ever-increasing numbers of scams are also making them sit up. Some schools are offering specialized training in financial matters. Thus there is a wave of change in the field of social service work in the wake of the foreclosure crisis.

The School of Social Work under University of Maryland introduced the idea of ‘financial social work’. Workshops are held and there are for students mini-courses. Professors in St. Louis have set up a ‘think tank’ to find out in what way social work organizations and schools can best prepare their students to help clients to make financial decisions.

Reeta Wolfsohn of Ashville, North Carolina, is offering a certificate course on the Internet. It embraces 20 states. In Wilson County, North Carolina, the Social Service Department has hired a person who has completed Wolfsohn’s course as a ‘financial coach’. Susan Parker the manager of Self-Sufficiency program of Wilson County said, “Before, we’d do a two hour training session for clients and pat ourselves on the back. But we were just giving them information. No one was helping them one-on-one to change behaviour.” But the new angle of approach is not just about throwing “safety nets to families. It’s about teaching them to be their own safety net.”

Sharon Mercer is 41 and a single mother of nine children starting from 4 to 17. She has benefited from this change of approach of social workers. She did not have a job but was afraid to seek help from the county fearing that the children would be taken away from her. But she was surprised when the social workers built up her confidence. She said, “It wasn’t about just giving me a check – it was about building my confidence.’ She kept saying that she could not whereas they kept saying that she could.