Which type of bankruptcy allows individuals to create a repayment plan?

Chapter 13 Bankruptcy is designed specifically for individuals who want to retain their property while repaying their debts over time. This type of bankruptcy allows individuals to create a repayment plan that lasts three to five years, during which they can make manageable monthly payments based on their income. The process enables individuals to reorganize their debts and catch up on missed payments, making it a viable option for those facing financial difficulties but who have the means to repay a portion of their debts.

In contrast, Chapter 7 Bankruptcy involves liquidating assets to pay off creditors and does not provide a repayment plan, making it suitable for individuals with limited income and significant unsecured debts. Chapter 11 Bankruptcy primarily serves businesses and can also be used by individuals with complex financial situations, allowing for a reorganization plan but usually involves a more complicated process compared to Chapter 13. Chapter 9 Bankruptcy is tailored for municipalities and is not applicable to individuals. Therefore, Chapter 13 stands out as the appropriate choice for individuals seeking to reorganize their debts and establish a repayment plan.