A proposal to creditors is used by an insolvent debtor having difficulty meeting payments
A)and must be rejected by creditors within 45 days, or it will be deemed to be accepted.
B)will remain on the credit bureau report for seven years after terms have been met.
C)only when total debt is less than $100 000.
D)so that the creditors may avoid filing for bankruptcy.

Question

Quizplus · Accepted Answer

A proposal to creditors is a formal offer made by a debtor to their creditors, proposing to pay back a portion or all of their debts over a set period of time. Creditors have 45 days to accept or reject the proposal, and if they do not respond within this time, the proposal will be deemed to be accepted. This mechanism allows the debtor to avoid filing for bankruptcy, and it is often used by companies to restructure their debts and continue operating.

A Proposal to Creditors Is Used by an Insolvent Debtor