A bankruptcy judge on Friday said that a group of Residential Capital LLC's bondholders aren't entitled to interest accrued since the mortgage servicer's bankruptcy filing, at least as of now, Dow Jones Newswires reported on Friday. Bankruptcy Judge Martin Glenn said that ResCap's junior secured noteholders are owed $1.9 billion and thus aren't "oversecured," after the first phase of a trial held last month. If the bondholders are deemed oversecured — which could still happen — they'd be entitled to interest accrued since ResCap's May 2012 bankruptcy filing, which they say is being racked up at $250 million per year. Another phase of the trial could still alter the numbers and render the creditors oversecured. But Judge Glenn said that the bondholders were wrong when they said they are owed $2.22 billion and are actually undersecured by $318 million. He did deal ResCap a blow by saying that the company can't collect $143 million in expenses related to the loans.
