Arizona Family Loses Home to Foreclosure, Neighbors Give Them a Place to Live

VIDEO: One neighborhood in Phoenix bans together to fight the foreclosure
WATCH Arizona Community Fights Foreclosure

After Michael Toczko lost his job in June as a stock broker near Phoenix, he and his family watched their home fall into foreclosure.

Toczko and his wife, Kristin Hailstone, swallowed their pride and knocked on their neighbors' doors to tell them the news.

"We went to everyone and apologized for hurting their home values. We wanted them to know that we'd done the best that we could, truly, and everyone was just so gracious and all they cared about was keeping our family safe," Hailstone said.

Watch "World News with Diane Sawyer" tonight for more from Phoenix.

One family did more than keep the Toczkos safe. Liz and Joe Larger, a few doors down, took them in.

"We worked out the details," Joe Larger told ABC's Diane Sawyer. "We said, 'We're not each other's babysitters, we don't expect you to do this and you to do that.'"

Today, the Toczkos pitch in with what rent they can afford and together, the two families are a kind of experiment in generosity.

Liz Larger said that the families often "meet and cook a big dinner. It just kind of turns into big meals a lot, which is great."

Arizona Struggles with Foreclosure

The story of these two families is a story all too familiar in Phoenix.

The city is a hotspot for foreclosures. According to RealtyTrac, in the third quarter of this year, one out of every 69 homes in the Phoenix area went up for auction.

On top of the swelling number of foreclosed homes, Arizona's unemployment rate was 9.7 percent in September, just above the national unemployment rate. That means nearly one in 10 people are unemployed. In Phoenix, the unemployment rate was 8.9 percent last month.

The Toczkos' and the Largers' decision to consolidate their family homes is becoming less and less unusual. In the cul de sac where they live, three of the five homes have two families per address.

Phoenix Neighborhood Grows Closer Through Foreclosure

The Largers and Toczkos said that neighbors reaching out to neighbors is teaching their kids a good lesson.

"Losing a house is a big thing, but it's just stuff. It's not important...We're together, we're a family and we're enjoying each other and that's what's really important," Larger said.

The generosity displayed by these families might warm your heart, but the house is crowded. These homes of consolidated families have rules: don't yell, smile, be happy.

Michael Toczko and Kristin Hailstone continue to look for work. Kristin is working four part-time jobs and admits that the quest to find work is hard.

Still, the two families are holding on to each other, however long it takes.

"We went from having a big house," Kristin Hailstone said, "three bedrooms, family room, big and beautiful, and now we have small and beautiful and it's just really taught me a lot about what's actually important, that the trapping isn't important. This is what's's great to have good neighbors."

These two families, once just friendly neighbors, are now a family for these times.

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