good question why they did not file chapter 7 liquidation, however WMI had 3 things that were negotiable, and one had value... let me explain.....( 1) The depositors funds of 4 billion dollars, did not belong to JPM, and were given back to WMI during the GSA... (2) a tax credit paid to the IRS was split 3 ways between JPM, FDIC, and WMI, WMI was allowed 2.5 Billion in tax refunds... (3).. WMI negotiated 5.8 billion dollars in NOL credits for abandoning the 20.7 billion dollars in shareholders Retained earnings.. (see Feb 2010 MOR submitted to the bankruptcy court)...so lets add these sums up:... 4 billion in depositors funds plus 2.5 billion in IRS tax credit, plus 5.8 billion in NOLS = 12.2 billion in recovery from the GSA agreement...WMI took the 6.5 billion and placed it in the WMIL-T for disbursal to creditors to close the chapter 11, along with over 400 million in liquidation of 7 subs held by WMI in WMRRC..in conclusion, by filing chapter 11, instead of 7, the company was reorganized and continues today as Wmih with Nationstar as a sub... remember WMI threatened to sue JPM for 20 billion dollars for their assets, but the outcome according to Rosen might not have been successful and WMI could have lost... in this way, WMI got 12.2 billion in allowances for the 20 billion that they did not have to sue for , or 61% recovery... Lodas
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