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Many REITs, particularly the ones that are filing for bankruptcy, operate using large amounts of leverage. When the asset values (real estate) are decreasing in value rapidly, the large amounts of leverage can cause the REIT to have their liabilities outweight their assets (often illiquid) which leaves zero value to the equity. In this case it may be particularly unlikely that you will receive anything from the bankruptcy but you will need to follow the ruling from the bankruptcy court to know for sure.

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Q: If you invested a large sum of money in a real estate investment trust - REIT- and the company just filed for chapter 11 what are the chances of getting your principle back?
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