Business Law Bankruptcy Chapter 13
Bankruptcy Chapter 13 is a legal process that allows individuals and small businesses to reorganize their debts and create a repayment plan that spans over a period of three to five years. This type of bankruptcy is often referred to as a "wage earner's plan" as it requires the debtor to have a regular income in order to make monthly payments to creditors. Under Chapter 13, debtors can retain their assets while catching up on missed payments, such as mortgage or car loan arrears. Additionally, Chapter 13 may allow debtors to reduce the amount they owe on certain debts, such as unsecured loans or credit card balances.