Which type of bankruptcy is designed for individuals?

Chapter 13 bankruptcy is specifically designed for individuals who have a regular income and wish to restructure their debts while keeping their assets. It allows an individual to create a repayment plan to pay off their debts over a period of three to five years. This is beneficial for those who want to avoid liquidation of their assets, which occurs under Chapter 7 bankruptcy, and it also helps individuals catch up on missed mortgage or car payments, preventing foreclosure or repossession.

In contrast, Chapter 7 bankruptcy is more suitable for individuals seeking a fresh start by discharging unsecured debts but does not involve a repayment plan. Chapter 11 is primarily intended for businesses and high-debt individuals who need to reorganize their financial structure. Chapter 14 does not exist within the standard bankruptcy law framework, making it an invalid option. This emphasizes the specialized nature of Chapter 13 for individuals wanting to maintain their assets while managing debt repayments.