Housing

Toxie's In a Coma!

Toxie, Planet Money's mortgage-filled toxic asset, is in bad shape.

We bought Toxie for $1,000 earlier this year. Every month, we get a check. It's a small piece of the payments people are making on their mortgages. And every month, more houses get foreclosed on and sold off by the bank. When enough houses get sold off by the bank, Toxie will be dead.

She's not dead yet — but things are looking grim.

Last month, we got $72.41; so far, we've received a total of $449.

This month, our payment was zero dollars and zero cents. We could still get another payment next month — maybe. (This graphic has more on the status of the mortgages and the payments we've received.)

Samir Noriega, a partner at NPM Capital Management, took a look at Toxie for us. He figured out that lenders forgave some of the principal on the some of the mortgages.

Those are the kind of loan modifications the government's been encouraging as part of its HAMP plan, which is aimed at keeping more people in their homes and reducing the number of foreclosures.

Lowering the principal is sometimes done for homeowners who owe more on their house than it is worth — people who, like the Planet Money team, bought an overvalued asset.

The modifications meant that the value of the mortgage payments declined. As a result, there wasn't enough money left in the monthly pool to pay us.

More Toxie:

The team at PBS's Patchwork Nation built the map below, which shows where the mortgages in Toxie are located. Click here or on the map to see more.

Note: (PBS/Patchwork Nation) hide caption

itoggle caption (PBS/Patchwork Nation)

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