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Hundreds of Haredi (ultra-Orthodox) families squatted in apartments built by the Heftsiba company throughout the country yesterday, out of fear that the homes they had purchased would be seized by the company's creditors.

The media reported earlier this week that the company was near bankruptcy, and trading in its shares was suspended yesterday.

Reports of the company's expected collapse began spreading through the Haredi community on Wednesday, causing many worried purchasers to consult real estate experts from their community. On these experts' advice, numerous families began moving into their purchased apartments Wednesday night, in Beit Shemesh, Betar Ilit, Modi'in Ilit, Ma'aleh Adumim, Jerusalem's Har Homa neighborhood, Netanya and other towns.

Both the squatters and other sources in the Haredi community deny that the mass action was organized on orders from the rabbis. "In order to save $150,000, do you need to go ask a rabbi?" demanded Betar Ilit Mayor Yitzhak Pindarus.

While not all of Heftsiba's clients - and not all the squatters - were Haredim, the ultra-Orthodox accounted for the lion's share of yesterday's operation.

The biggest squatting operation was in Modi'in Ilit, where dozens of families either moved into their own apartments or sent friends or relatives to move in on their behalf. About half the squatters appeared determined to remain; the others left due to the difficult conditions: Some of the apartments have not yet been hooked up to water and electricity. The squatters put up mezuzahs, changed the locks and began ferrying containers of water to the apartments. The municipality supplied all the squatters with lunch.

In Betar Ilit, Haredim squatted in about 50 apartments that were completely finished and had already received the necessary permits for water and electricity hook-ups, but to which the new owners had not yet received the keys. They therefore used ladders to climb up to the balconies and break in through the windows.

Thus far, Heftsiba has not filed any complaints to the police, so the police are not trying to evict the squatters.

In Modi'in Ilit, however, the squatters are violating an injunction issued previously by the High Court of Justice. The houses they moved into yesterday are in the East Matityahu neighborhood, which is the largest illegal building project in the territories, comprising some 350 apartments. Because some of the apartments are on privately owned Palestinian land, the Peace Now movement petitioned the High Court of Justice about a year and a half ago to prevent the owners from entering, and in response, the court issued an injunction preventing anyone from moving in until it rules on the petition. The squatters are thus violating this injunction, and Peace Now consequently demanded that the police remove them immediately.

As of last night, however, the police had no plans to do so.

The squatters stressed yesterday that they were not in Matityahu East - or any other community over the Green Line - out of any desire to be settlers; they are merely in search of cheap housing. A three-room apartment in Matityahu East costs NIS 90,000 - some NIS 20,000 less than in older neighborhoods of Modi'in Ilit and orders of magnitude less than an apartment in Jerusalem.

Yet many Haredim find it hard to raise even that sum. Haim Shapira, 24, related that to buy his apartment, which he did prior to his marriage two years ago, his parents scraped together everything they had and he obtained the rest of the money from an interest-free loan fund. Now, he is squatting in the apartment, desperate "to save the only property I own," he said.

Heftsiba's owners, the Yona family, spent yesterday in efforts to arrange a stay of proceedings that would prevent its creditors from descending on it. The company has not issued any official response to either the squatting operation or the media reports of its financial woes, having apparently decided to wait until it has a better idea of its prospects.

A senior Heftsiba employee tried to commit suicide at Jerusalem's Crowne Plaza Hotel yesterday. He was evacuated to Hadassah Hospital, Ein Karem in moderate condition after slitting his wrists.

In addition, dozens of Haredim demonstrated yesterday outside the company's offices in Jerusalem.

Arik Merovsky contributed to this report