The investment firm of Smith Rothchild Financial Co. has reached a key agreement in their Chapter 7 bankruptcy case. An Indiana investor has agreed to purchase a portfolio containing 125 loans and residential properties in the Chicago area.
REL Financial LLC based in Munster, IN has agreed to pay $237,777 for loans and properties. The amount is a fraction of the $4.9 million owed to Smith Rothchild’s secured creditors, according to U.S. Bankruptcy Court records.
Distressed single-family homes and apartments and the loans secured by the properties are contained in the portfolio. Most of the properties are located on the South and West sides of Chicago and Gary, Ind. REL is paying $115,000 for the properties and $122,777 for the loans. The transaction is awaiting approval from the judge.
Smith Rothchild, a Chicago based investment firm, provided short-term financing to investors that rehab properties. The firm filed for Chapter 7 protection in May of 2010. Essex Realty Group Inc. was hired in March of 2011 to market the portfolio.
CIT Group Inc. is Smith Rothchild’s largest secured creditor with a claim of $2.9 million. Cole Taylor Bank is the second largest creditor, holding a $1.8 million claim. The portfolio’s low price means that secured creditors will receive pennies on the dollar.
If you are considering Chapter 7 bankruptcy, contact a Chicago bankruptcy attorney. A bankruptcy attorney will discuss the filing options that are available to you.