This paper studies creditor governance in Chapter 11 firms through their loan-to-loan strategy, whereby prepetition creditors continue to provide lending after a borrower files for Chapter 11, and loan-to-own strategy, whereby creditors become equity holders at a borrower’s emergence from Chapter 11. We show that activist creditors strategically choose targets to enforce their influence. We find that maintaining lending relationships with a borrower is a major consideration for loan-to-loan participants. Existing lenders select targets with better operating performance and stronger institutional shareholder presence to continue with the lending. Loan-to-loan strategies enable these creditors to gain control of management hiring, resulting in a higher likelihood of firms hiring an external CEO. In contrast, loan-to-own strategies allow unsecured creditors to gain equity ownership thus weakening the liquidation bias of secured creditors, and to improve corporate governance of emerged firms. We further show that activist creditors seek board representation at emergence. Our paper provides fresh new evidence on different strategies adopted by activist creditors in distressed firms.