An Exploration Of Lending And The Bankruptcy Code

Law360, New York (June 26, 2013, 1:13 PM EDT) -- Section 364 of the Bankruptcy Code authorizes a debtor to obtain credit. Section 364 can be viewed as a menu containing various options for obtaining credit, ranging from the lenient provision allowing ordinary course unsecured indebtedness through the much stricter provisions for obtaining liens on already-encumbered assets.

Obtaining Credit Under Section 364

Specifically, section 364(a) authorizes the debtor to obtain unsecured credit and to incur unsecured debt in the ordinary course of business, and provides that such obligations will receive administrative expense status under section 503(b)(1)....
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