What is the difference between a Chapter 11 and a Chapter 13 bankruptcy?

The two most common forms of bankruptcy for individuals in North Carolina are Chapters 11 and 13. Chapter 11 bankruptcy is typically used by businesses, although individuals are also eligible to file under Chapter 11. It is a reorganization process, meaning that it allows you to set up a payment plan with creditors to pay off your debts. The advantage of Chapter 11 is that it lets you keep your assets while restructuring your debt. Chapter 13 bankruptcy is designed to help individuals who have a steady income but still have a large amount of debt to pay off. Through Chapter 13, you can create a repayment plan for your creditors stretching up to five years. This repayment plan is structured to allow you to keep your assets, like a car or a home, while you pay off your debt. The main difference between the two forms of bankruptcy is that Chapter 11 is meant for businesses and individuals, whereas Chapter 13 is intended for individuals only. Additionally, in Chapter 11 bankruptcy, you can create a repayment plan that lasts up to seven years, while in Chapter 13 bankruptcy, you can create a repayment plan that lasts up to five years. In Chapter 13, you are also able to keep your assets if you make your payments on time. Overall, the primary difference between Chapter 11 and Chapter 13 bankruptcy is the eligibility of the filer and the length of the repayment period.

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What is the difference between a Chapter 11 and a Chapter 13 bankruptcy?

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