Creditors holding about 90 percent of Carvana Co.’s bonds have been pitching the beleaguered used-car company on ways to pare down debt and improve liquidity, including a proposal for a debt-for-equity swap, according to people with knowledge of the situation.

The group, represented by White & Case and PJT Partners, recently offered to swap a substantial amount of unsecured notes for equity in Carvana, the people said, asking not to be named discussing a private matter. The bondholders also said they would allow the company to pay some of its interest with additional debt, a feature known as payment-in-kind.

The proposal isn’t final and terms could change. Carvana has not formally engaged with the group’s offers, the people added, asking not to be identified because the matter is private.

Bondholders had earlier signaled their interest in moving their existing unsecured positions into new first-lien debt and allowing the company to pay interest in kind for two years, the people said. The plan would save Carvana more than $1 billion in cash interest, the people added. The group also offered to provide new money to the company and asked Carvana’s equity holders to inject roughly $1 billion into the business, they said.

Representatives at Carvana, one of its advisers Kirkland & Ellis, and White & Case didn’t respond to requests for comment. PJT and another Carvana adviser Moelis & Co. declined to comment.