Low Projected Recovery for Deposit Holders in Levitt & Sons
Levitt & Sons, a homebuilder which filed for bankruptcy in Nov’07, has finally obtained court approval of its Chapter 11 plan. The unsecured creditors are projected to recover between 2.75-13.7%. On the other hand, creditors with claims on deposits are projected to recover between 2.75-23.2%. It is pretty low recovery and cold comfort for deposit holders. Nonetheless, it should be expected because deposit holders, whose money are not held in escrow, are essentially unsecured creditors (with those purchasing a primary residence having unsecured priority claims).
