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ResCap files for Chapter 11

Mortgage lender Residential Capital filed for Chapter 11 bankruptcy protection on Monday. The Richfield-based company needs help from its parent company to repay about $12 billion owed to the federal government for a bailout during the financial crisis. ResCap has 3,500 employees and reported $15.3 billion in total debt.
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Mortgage lender Residential Capital filed for Chapter 11 bankruptcy protection on Monday. The Richfield-based company needs help from its parent company to repay about $12 billion owed to the federal government for a bailout during the financial crisis. ResCap has 3,500 employees and reported $15.3 billion in total debt.

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Warren Buffett's Berkshire Hathaway Inc. is eyeing a $374 billion mortgage-servicing portfolio of Residential Capital LLC. The bankrupt lending unit, a subsidiary of government-owned Ally Financial, filed for Chapter 11 protection in May. Dow Jones News Wires reports Minnesota-based ResCap already has a proposed agreement to sell the mortgage unit to NationStar Mortgage Holdings Inc. Berkshire says it will match the $2.4 billion bid, but offer a lower breakup fee.

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