Mortgage lender Residential Capital LLC is seeking bankruptcy court approval to pay back more than $1.1 billion it owes to parent Ally Financial and to send another $800 million to bondholders, Dow Jones Daily Bankruptcy Review reported today. Lawyers for ResCap said in a court filing on Monday that by paying down its entire debt to its parent plus a portion of the $2.1 billion in principal it owes to bondholders now, the mortgage lender can eliminate millions of dollars in future interest payments. Interest payments to bondholders alone could reach $20 million a month and that cash, ResCap said, could instead go to its other creditors.
