Do you ever wonder how someone can sink to the point where they can no longer keep a roof over their head?

Here is the story of someone I personally know who is nearing that point. Here, from my perspective, is how she got there and what she might want to think about doing before she actually loses her home.

She (we will call her Susan, although that is not her name) started life as a member of an industrious lower middle class family – one sibling, two parents married to each other. Growing up, she excelled in academics, receiving top grades all the way through school and then going on to get a master degree in biological sciences and even completing most of the course of study for a doctorate.

1. Sink Into Depression

Her dream of becoming a college professor died when her dissertation was not accepted and she did not win the doctorate. After a two year marriage, she divorced and came home to live with her parents.

Disappointed in herself for not winning her doctorate, recovering from an injury caused by an attack in the service and suffering from the rejection of a divorce, she could not bring herself to look for work.

Finally, her Dad put his foot down and insisted she get a job and help out with household expenses.

2. Get Laid Off From Work

For 12 years she worked as an assistant to research scientists – continuing to live with her parents. Her Dad died, and she continued to live with her Mom. She was laid off from her job and didn’t look for another one. Mom continued to support her she too died.  Susan inherited the house, free and clear, along with several hundred thousand dollars.

3. Use Up Existing Resources

While continuing to live a relatively frugal lifestyle, she continued to live off of Mom (through her inheritance). She began to accumulate clutter. She gave large gifts to close friends. She ignored checks and had money escheated back to the state. Although friends tried to help by offering part time employment, she was unable to keep a paying job.  She couldn’t stretch the inheritance, no matter how thrifty she was, to last more than 15 years.  In fact, she did pretty good making it last that long.

4. Borrow Money You Can’t Pay Back

Eventually the inheritance ran out. She borrowed money to satisfy the city when they cited her for repairs that needed to be done on the house. She charged up credit cards to buy food and clothing. She ignored collectors and now the card company is suing.

5. Discontinue Insurance

Since she could no longer afford to pay it, she stopped the home insurance and stopped using the cars she inherited (also free and clear).  Although she has been lucky, a fire or tornado could put her on the streets in a minute.

6.  Don’t Pay Your Taxes

She stopped paying income tax on the rare occasions when she did have income and did not pay county real estate taxes. Family and friends paid multiple years of taxes for her, but she couldn’t pay when the taxes again became delinquent. Of course the IRS put a lien on the house, and after three years, the county put the house into the tax lien certificate sale. She would have a year to come up with the money or she would lose the house.

7. Time To Get Ready To Be Homeless

Susan does not have the income needed to pay for basic necessities. Her gas is turned off, she heats water in the kitchen to shower, and dries her clothes on the line. She is on the low income payment plan for electricity and uses her Social Security check to pay that and the water bill. She gets all her food from the food pantry, which she visits on her bicycle. Her health care is via the Veteran’s Administration as she has no health insurance.

There are of course, many other reasons people become homeless.  Serious injury, foreclosure, accidents or the need to support an dependent with a chronic illness, for instance can all contribute to the likelihood of losing your house.

What To Do Before Losing The House

Get help:

• Find free legal aid organizations to help with the lawsuit.
• Consider selling assets and the house and moving in with someone else.
• Use credit counseling to try to get your financial life back on track.
• Find free legal aid organizations to help you file for bankruptcy. – to protect your house.
• Find services providing psychological counseling to help get your life back on track.
• Line up several places to visit (relatives, friends, acquaintances).

Get ready:

According to Dorid (who has been homeless) in her BlogHer post How to Prepare for Homelessness,  here are some ways to prepare for losing your shelter.

• Figure out what important papers you will need to have with you (birth certificate, social security card, drivers license if you have one – make sure they are originals or certified copies and are up to date).
• Only plan to take what you can carry in a suitcase and make that suitcase as large as you can manage. Only take what you will actually use now. Wear as many of your clothes as you can (especially in cool weather).
• Know where the motels, shelters, soup kitchens and food pantries are, and what you need to have/ do to get in. Be prepared to spend money on a cheap hotel if you can’t get into a shelter or take a tent (if you can carry it).
• Get some transportation. See if you can find an agency that will provide a monthly bus pass. If you have access to a car, use it! A car will allow you to keep more stuff, give you some privacy and provide a place for you to sleep if needed.
• If you can find a way, join a gym. Gyms have hot showers and bathrooms, and are a warm place to hang out.
• Have a way to make phone calls. There are several free options out there if you can connect to the internet (perhaps from the public library).

Susan is not alone.

Susan met many conditions which can cause a person to lose their house.  Some she might have controlled, others were no fault of her own.  According to National Alliance to End Homelessness report: there were 636,017 homeless Americans in 2011. Many people have lost homes since the 2008 downturn, however, a new government program has helped to prevent an enormous increase in homelessness so far.  It is the Homelessness Prevention and Rapid Re-Housing Program (HPRP, funded through the American Recovery and Reinvestment Act of 2009) was a $1.5 billion federal effort.

Did I help Susan?

Yes, I have helped Susan several times with some significant financial resources and am trying to help her more, but often she ignores or rejects my help.  Susan needs more than financial help, more help than I know how to give, but I will keep trying.

Have you been homeless? How would you prepare?

More resources:

• Guide to Homelessness
• 10 Things You Need to Know to Live on the Streets
• How to Live Homeless Survival Guide
• National Homeless Organization