Homeowners Want Their Own Committee in ResCap Bankruptcy

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Homeowners Want Their Own Committee in ResCap Bankruptcy

Homeowners Want Their Own Committee in ResCap Bankruptcy

Fox Business-

Homeowners with mortgages serviced by Residential Capital LLC want to form an official committee in the company’s bankruptcy case, which would give them a louder voice in the company’s complicated Chapter 11 proceedings.

In a Friday filing with U.S. Bankruptcy Court in Manhattan, a lawyer for the group of homeowners said they’re concerned that state and federal settlements this year with mortgage servicers including ResCap’s government-owned parent Ally Financial might not be enforced properly now that ResCap is in bankruptcy. A ResCap spokeswoman declined to comment.

The settlement, over borrower claims of improper foreclosure practices, offers billions of dollars in relief to many homeowners who either owe more than their homes are worth or were forced to sell their homes and move. While the homeowners do have one representative on ResCap’s official committee of unsecured creditors–a plaintiff in a Pennsylvania class-action lawsuit brought by the same lawyer asking for a committee–the group said it needs more say to protect its interests.

[FOX BUSINESS]

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