Pimco in Eminent Domain Homeowner-Hospital Encounter: Mortgages

Robert and Patricia Castillo, a California couple who have already had their monthly mortgage payments cut by almost 60 percent, want the city of Richmond to reduce their debt by using its powers of eminent domain. That could be bad for hospitals in Missouri.

The Castillos owe $436,500 on two loans on a three-bedroom home that’s now worth about $125,000. The hospitals are members of a mutual insurer that’s among investors in the Pimco High Yield Fund, which owns a slice of bonds backed by loans including the Castillos’.