Through troubled debt restructuring (TDR), a firm can restructure the terms of its debt arrangements with creditors in an effort to stay out of bankruptcy or insolvency. The loan's terms are renegotiated, maybe including a lower interest rate, a longer payback period, or even a debt cancellation in order to facilitate this form of restructuring. It can be used for any type of defaulting or potentially defaulting debt, including business and consumer debt. Creditors can recoup some of their losses through TDR, and debtors can stay afloat and keep running their businesses.