The ability to file for personal bankruptcy or business bankruptcy protects those who make mistakes about starting a business or how they invest their savings. Bankruptcy is also helpful for those who have just battled cancer or gotten hurt in a car crash.
As a family farmer, you undoubtedly feel like you have a lot to lose if you file for personal bankruptcy. In a Chapter 7 individual or business bankruptcy, the courts typically require the liquidation of certain assets, including real estate and valuable equipment.
You need to gain control over your financial obligations because illness or a failed crop has left you struggling financially, but you can’t risk the loss of your land or your equipment. Is it possible to protect your assets while filing for bankruptcy as a farm owner?
Chapter 12 is ideal for farmers
The land and equipment that you own aren’t just valuable resources. They are how you support yourself and your family. The property may have been in your family for multiple generations, and it may be the legacy you intend to pass to your children someday. Your farm equipment may have large loans attached to it, but you recognize that you need those incredibly expensive machines to operate an efficient farm.
Chapter 12 bankruptcy allows you to protect your most valuable resources while working to restructure some of your debts. When successful, a Chapter 12 filing will eventually result in the discharge of some unsecured debt, including medical deaths and credit card balances.
Chapter 12 is a complex form of bankruptcy
There are some individuals who managed to successfully file Chapter 7 bankruptcy on their own, and even a few people who handle complicated Chapter 13 proceedings. While it may seem like a smart way to save a few dollars when you are already struggling financially, trying to file a complex form of bankruptcy without help could lead to failure.
The right support will help you regain control over your farm’s finances and resources, making it well worth the investment. Especially when you consider what may be at risk if the courts reject your filing and deny your discharge, you may understand why getting help early in the process will be the best option as you seek to put your financial woes behind you. Filing for Chapter 12 bankruptcy can help farmers who want to continue their agricultural operations plan a path forward.