This paper examines determinants of creditor recoveries from defaulted debt instruments. First, we argue that to properly measure a debt instrument's relative position in a firm's debt structure, debt pari passu to the instrument must be accounted for. We thus propose a new measure of seniority and find that it is the most important determinant of recovery rates. Second, firm-level variables, especially the trailing twelve-month stock return, are more critical than industry- or macro-level variables, although the latter can also help, particularly for private firms for which stock price information is not available. Unlike earlier studies, we find that the relative contributions of the industry and macroeconomic variables vary with the sample, model specification and especially the modeling technique used.