Home builder hopes to reconstruct during recession
Tuesday, May 5th, 2009
By: Susan Phillips
sphillips@whyy.org
A suburban Philadelphia home builder has filed for bankruptcy. At risk are hundreds of thousands of dollars in deposits paid by home buyers for developments in Pennsylvania and New Jersey.
Listen:
Audio clip: Adobe Flash Player (version 9 or above) is required to play this audio clip. Download the latest version here. You also need to have JavaScript enabled in your browser.
T.H. Properties in Harleysville filed this week for Chapter 11 bankruptcy. A message on the company phone says they hope to resume construction within the next few weeks if they are successful in re-organizing.
Amelia Boss is a law professor at Drexel University. Boss says if the re-organization is unsuccessful, then the home buyers could lose their deposits and their properties.
Boss: If there is a bankruptcy and the properties are liquidated, if there is not enough money to pay off all the secured loans than there may not be enough money to pay off all these buyers.
Boss says its not uncommon for developers to run into trouble, especially in a recession. Home sales in the Philadelphia region dropped 25 percent in March compared to 2008.