Debt restructuring is a process of reorganizing and renegotiating debt agreements to create lengthy payment plans, lower interest rates and/or reduce the total amount owed. It is available to individuals, companies, and even countries and assumes multiple forms to suit the particular needs of each entity.

Debt restructuring begins with a careful review of the current financial status of the person or company in debt. This involves assessing the nature of the debt and determining a feasible repayment plan that fits into the person or company’s income and financial goals. During the restructuring process, all existing creditors must agree to terms and conditions of repayment.

Debt restructuring can involve reducing the interest rate of loans, making the repayment periods longer and reducing the amount owed overall. In some instances, debt restructuring may include a debt-for-equity swap. This is when a portion or all of the existing debt is eliminated in exchange for an ownership interest in the company.

Additionally, a nation may seek to restructure its debt by transferring the debt from the private sector to public sector institutions. This allows the government to control the repayment schedule, create economic incentives and set the terms of how it would like to clear the nation’s debt.

Because debt restructuring can have far-reaching financial implications, it is important that all parties involved have a deep understanding of their financial situation and the potential benefits and drawbacks of such a move. Companies considering debt restructuring should consult with a financial advisor or accountant, who can advise on the best course of action for the company's finances.