The Personal Costs of Subprime Lending and the Foreclosure Crisis: A Matter of Trust, Insecurity, and Institutional Deception


  • *Direct correspondence to Lauren M. Ross, Temple University, Sociology Department, Gladfelter Hall, 7th Floor, 1115 W. Berks St., Philadelphia, PA 19122 〈〉. Lauren Ross will provide all data and coding information to those wishing to replicate the study. We thank the National Community Reinvestment Coalition for its assistance on this project.


Objective. Research on widespread loan failures suggests that many of the mortgage loans that were made since 2000 were of a deceptive or predatory nature. This study explores the experiences and sentiments of those who are at risk of foreclosure within a broader framework of trust, individualization, and ontological security.

Methods. Interviews examine families' lending experience and how they have coped with their personal troubles that resulted from their housing crisis.

Results. As many of these loans were of a deceptive or predatory nature, individuals are likely to reflect on the psychological consequences of their predicament. Although these findings suggest that these individuals have lost trust in the housing market, many have internalized their situation as a personal failure. In addition, feelings of anxiety, stress, insecurity, and uncertainty have come to characterize their experiences.

Conclusions. This research calls for policy recommendations that seek to restore confidence and to ensure greater consumer protection in financial markets.