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As Chapter 11 Bankruptcy Filings Surge, Here’s What Creditors Need to Know to Protect and Enforce Their Rights

Fraser

In most chapter 11 cases, the debtor files a series of “first day” motions with the bankruptcy court seeking relief that it may not otherwise be automatically entitled to receive under the Bankruptcy Code. Such relief may include a request to pay some unsecured creditors (such as employees or “critical vendors”) ahead of others.

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How Businesses Use Corporate Debt Restructuring for Liquidity

Debt RR

Refinancing typically lowers monthly payments and interest rates in exchange for lengthening the timeframe of the loan. Some creditors will accept equity and/or other concessions in exchange for debt forgiveness. Regardless of how it’s restructured, creditors often choose this route to protect their investments. Noteholders.