CIT Group Inc.'s bondholders had until midnight today to cast their votes on the embattled commercial lender's future, but they may have to wait until sometime over the weekend to finally learn its fate.

Bondholders had until 11:59 p.m. EDT to exchange roughly $31 billion in debt for new bonds that mature later and preferred stock in a reorganized CIT. But it may take a while to count the votes. A person familiar with the process said CIT has distributed 150,000 ballots.

The company is hoping to cut its $31 billion bond debt by at least $5.7 billion.

If the exchange offer does not get enough support, CIT hopes that enough bondholders will accept a prepackaged bankruptcy plan that would permit it to restructure its debt with the help of a federal judge and re-emerge within a couple of months.

The prices of CIT's bonds and the cost of insuring this debt against a default indicate that investors are betting that the debt swap will fail and that CIT will file for bankruptcy.

If bondholders agree to the exchange offer, they could get as much as 90 cents on the dollar of new debt along with some equity. If they vote in favor of a prepackaged bankruptcy, CIT is offering 70 cents on the dollar and equity in the reorganized company.

CIT's $500 million of bonds due Nov. 3 were quoted at around 67 cents on the dollar Thursday, according to one trader. Meanwhile, it costs investors about $3.9 million up front plus a $500,000 annual fee to protect $10 million of CIT's senior bonds against a default for five years. This represents an acute level of distress and suggests bondholders believe CIT has slim chance of staying out of bankruptcy court.

If the debt exchange fails, CIT would not make $800 million of payments on bonds which mature Nov. 1 and Nov. 3, and would file for bankruptcy as soon as Monday, people familiar with the matter have said previously. A prepackaged bankruptcy would mean CIT could exit the process within a couple of months.

But even a successful bankruptcy may not be enough to fix the company's broken business model. CIT's ability to raise funds cheaply remains hamstrung by low credit ratings and by Federal Deposit Insurance Corp. restrictions on its capacity to raise deposits through its Utah bank.

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