Albany, New York, Chapter 12 Bankruptcy Attorney | Debt Relief for Family Farmers or Family Fishermen

What is a Chapter 12 Bankruptcy?

This chapter of the Bankruptcy Code is relatively new, having been added in 1986. It was designed to allow for the adjustment of debts for those persons considered "family farmers" or "family fishermen" who have regular income from a crop or catch. A "family farmer" or "family fisherman" can mean an individual, a husband and wife, a partnership, or a corporate entity. There are specific requirements in the Bankruptcy Code that must be met in order to qualify for a Chapter 12 bankruptcy.

In the State of New York, retaining the services of a qualified Chapter 12 Albany Bankruptcy Lawyer is essential if you are filing under Chapter 12 of the Bankruptcy Code. All of the other chapters of bankruptcy are also available to family farmers and family fishermen and one of those chapters might be a better option. But Chapter 12 was designed to meet some specific needs of financially distressed farmers and fishermen and an experienced Albany County Chapter 12 Bankruptcy Lawyer is going to be the best source of advice of which chapter to file for debt relief.

How is a Chapter 12 Albany Bankruptcy Different from Other Chapters of Bankruptcy?

Here are some basics of Chapter 12 to illustrate the pros and cons of this bankruptcy chapter compared to the others:

► Chapter 7 is a liquidation bankruptcy and this would be a reasonable option if the farmer or fisherman has no regular income and wants to cease and discontinue their farming or fishing operation. All property and assets of the farmer or fisherman would be valued and liquidated to pay creditors. Check with an experienced Albany Chapter 12 Bankruptcy Attorney who will review your specific financial circumstances and advise whether or not a Chapter 7 bankruptcy would accomplish your goals and provide the debt relief you are seeking.

► Chapter 13 bankruptcies and Chapter 12 bankruptcies are very similar. Both are designed to allow for an adjustment of debts and a repayment plan over a period three to five years. The most notable difference in a Chapter 12 bankruptcy is the debt limits: Chapter 12 debt limits are $3,792,650 for the family farmer and $1,757,475 for the family fisherman. Operating a fishing or farming operation will incur much greater debts than an average consumer will incur, so the Chapter 12 debt limits are much higher than they are for Chapter 13 bankruptcy.

Both Chapter 13 and Chapter 12 bankruptcies require that the debtor have "regular income" in order to fund the plan and make the plan payments. Chapter 12 bankruptcies, however, take into consideration the economic realities of farming and fishing operations – namely, that income may be regular, but it will also likely be seasonal. A qualified Albany Bankruptcy Lawyer will be able to advise you about the benefits of both the Chapter 12 and Chapter 13 bankruptcy laws and suggest the best course of action for your situation.

► Chapter 11 bankruptcy cases also bear a great similarity to Chapter 12 cases. However, when Congress enacted the Chapter 12 bankruptcy laws their intention was to provide debt relief for family farmers and family fishermen and remove some of the difficulties associate with filing a Chapter 11 (or Chapter 13) case. For that reason, the laws and rules for Chapter 12 bankruptcies make filing a Chapter 12 less expensive and less complicated. Consult with your Chapter 12 Albany Bankruptcy Attorney for advice on Chapter 11 vs. Chapter 12 cases.

The Chapter 12 Plan

As in a Chapter 13 and Chapter 11 bankruptcy case, a debtor in a Chapter 12 bankruptcy case must file a repayment plan with the Bankruptcy Court. Your Albany Bankruptcy Attorney will work you to develop a fair and reasonable plan that will gain Court approval.

The plan must contain details of:

• all income expected to be earned over the life of the plan;
• how payments will be made to the creditors and in what priority order;
• how loans, leases, and contracts will be handled.

A confirmation hearing will be held at which any interested parties may object to the proposed plan. The plan goes into effect once it is confirmed by the Bankruptcy Court. The provisions of the confirmed plan are binding upon the debtor and the creditors.

At the end of the plan, if all payments have been made and all provisions met, the debtor will receive a discharge from the Bankruptcy Court. Consult with a qualified Chapter 12 Bankruptcy Law Firm for guidance on the Chapter 12 bankruptcy laws and process.

Common Causes for Financial Distress of Family Farmers and Family Fishermen

"Acts of God" are always a risk for farmers and fishermen: drought, hurricanes, tornadoes, floods and other extreme weather occurrences can change their fortunes in a matter of hours. Man-made disasters can also impact the farmer and fisherman: oil spills, fires, chemicals, etc.

These unexpected crises can certainly wreak havoc, but in the normal course of farming or fishing operations it is the day-to-day expenses that will have the greatest impact on the financial stability of the farmer or fishermen. In Albany, farmers and/or fishermen rely on suppliers such as those listed below to keep their operations running and the banks and other loan companies to supply the credit to make purchases:

Albany County Bankruptcy Law Firms can give you the advice you need to get a fresh start!

Serving clients throughout Eastern New York, including Albany, Colonie, Delmar, East Greenbush, Glenmont, Green Island, Hampton Manor, Latham, Loudonville, Menands, Roessleville, Troy, Watervliet, West Sand Lake, Westmere, Wynantskill, areas in the vicinity of Albany International Airport, and other communities in Albany County.

Contact an Albany Bankruptcy Attorney today for a free initial consultation.