A Creditor's Surrender of Collateral to a Debtor Without the Guarantor's

question 45

True/False

A creditor's surrender of collateral to a debtor without the guarantor's consent can reduce the guarantor's obligation.

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Definitions:

Existing Debt

Financial obligations or loans that a person or entity is currently responsible for.

Cram Down

When the court forces dissenting creditors whose claims would be impaired by a proposed plan to accept the plan when the court can find that it is fair and equitable to the class of creditors whose claims are impaired.

Reorganization Plan

A document detailing the process of reconfiguring a company's structure and operations, typically as part of bankruptcy proceedings.

Chapter 11

A provision under the U.S. Bankruptcy Code that allows for reorganization under the bankruptcy laws of the United States.