Question and Answer Guide
"No Value" Determination
IndyMac Bank, F.S.B., and IndyMac Federal Bank, F.S.B., Pasadena, CA
What happens to the deposit money that I think you still owe me?
The board's determination only addresses the insufficiency of funds realized from the resolution of IndyMac to make any distribution to general unsecured creditors or any lower priority claims. That determination does not address the rights of claimants regarding deposit claims.
Why did the FDIC do this?
The determination was made by the FDIC board of directors because substantially all of the assets of IndyMac were sold, but the amounts realized from the sale are insufficient to pay all of IndyMac’s liabilities. The Federal Deposit Insurance Act establishes the priority for distributing funds from the liquidation or other resolution of an insured depository institution. The Act provides that administrative expenses and deposit liabilities must be paid in full before any distribution can be made to general unsecured creditors or any lower priority claims. Because the conclusion was inescapable that there are insufficient assets to make any distribution on general unsecured claims, it was appropriate to have an official statement to that effect. That is why the board of directors made the determination on November 12, 2009 that insufficient assets exist to satisfy any general unsecured creditor or lower priority claims.
If the IndyMac receivership has no value, can I stop making my loan payments to IndyMac?
No. Any obligation you agreed to undertake in connection with a loan made, owned, or serviced by IndyMac is unaffected by the FDIC's "insufficient assets" determination. That determination does not change your obligation to make the payments as called for in your loan agreement (or, if applicable, pursuant to a loan modification agreement).
How does this affect my loan modification?
The "insufficient assets" determination does not affect your loan modification. The terms of the loan modification are not changed as a result of this determination. You should perform your obligations as called for in the loan modification agreement.
I did business with IndyMac and still have not been paid; all I received is a Receivership Certificate.
Unfortunately, even though your claim may have been “allowed” by the Receiver, as evidenced by the Receivership Certificate, no assets will be distributed to you for this claim. Simply put, no money will be paid to you on the claim.
I am an attorney representing a client who has open litigation against the Receivership. How does this affect our case?
Your client will not be able to obtain any payment from the receivership, even if you successfully pursued the case and obtained a favorable judgment on the claim. Because courts have consistently dismissed actions on the ground of prudential mootness under these circumstances, the FDIC as Receiver is requesting that you voluntarily dismiss this litigation and provide the attorney representing the FDIC as Receiver with a court-conformed copy of the order within the next 30 days. If this is not forthcoming, counsel for the Receiver will proceed to file a motion to dismiss your client's action.
While it is never easy counseling a client when further pursuit of a case is not appropriate, it may be helpful to share with your client that voluntarily dismissing the case will allow all parties to avoid the expenditure of unnecessary and wasteful attorney fees and costs and to conserve judicial resources.
Can I write off on my taxes the loss of my deposit or investment in IndyMac?
You may wish to consult a qualified tax advisor regarding the tax consequences in your individual situation.