The term "debtor-in-possession" ("DIP") financing refers to financing provided to an insolvent debtor while it attempts to reorganize in accordance with applicable insolvency legislation, which financing is secured by a court-ordered and court-approved charge of the property and assets of the debtor. In Canada, an existing lender is often the source of DIP financing because it is normally cheaper and easier for the insolvent debtor to deal with its existing lender and a new lender may be difficult to find, given the debtor's financial circumstances. However, there are many precedents for third party lenders agreeing to provide DIP financing. 

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