DIP Lending

DIP (Debtor-in-Possession) lending is a specialized type of financing provided to companies that are going through bankruptcy but want to continue operating. This loan helps the company pay for essential expenses like payroll and suppliers, allowing it to stay active while reorganizing its debts and operations. DIP loans are typically prioritized over existing debts, meaning they get repaid first when the company’s assets are liquidated. This form of lending provides the company with the necessary funds to stabilize and potentially restructure successfully during the bankruptcy process.