August 12, 2013 By:
You hear a lot about Chapter 7 “straight bankruptcy,” Chapter 11 “business reorganization,” and Chapter 13 “adjustment of debts of an individual.” But probably much less familiar to you is Chapter 12 “adjustment of debts of a family farmer or fisherman.” However, if you qualify for it, Chapter 12 provides some of the best benefits of all these options.
Chapter 12 is specifically designed for family farmers, ranchers, dairy owners, producers of poultry and livestock. (It also applies to family fishermen, much less likely relevant to folks in the Lone Star State.) Its purpose is to save your farm by reducing and restructuring your debts.
Chapter 13 and Chapter 11 are the other two possible options for reorganizing a business, which in the right circumstances could apply to a farm, ranch or similar business. But because Chapter 12 was created for family farmers and ranchers, and has some distinctive advantages, it is usually better than these other two options, again IF you qualify.
A Chapter 12 can be filed by you as an individual, by you and your spouse, or by the corporation or partnership in which you are an owner and which meets certain stock/equity/asset ownership thresholds. The main other qualifications, found in subsections 101(18) and (19) of the Bankruptcy Code, as they apply to farmers and ranchers, are:
Because Chapter 12 is designed for family farming, with a specific debt maximum amount, it is less complicated and usually much less expensive than Chapter 11 “corporate reorganizations,” which often apply to multi-million or even multi-billion dollar businesses. Chapter 12 is also more flexible than Chapter 13. Here are some of its main features:
If you live in, or in the areas surrounding, Rockwall, Heath, Greenville, Lavon, Wylie, Mesquite, Rowlett, Texas, contact bankruptcy attorney Carrie Weir to set up a free initial consultation to learn about this option. Please use the contact form here or by call Carrie Weir at 972-772-3083 to arrange a private meeting.