Is your farm mired in debt and getting little relief?
According to the American Farm Bureau Federation, the nation’s largest farm advocacy group, many farmers are struggling this year. Between January and September, 580 farmers filed Chapter 12 bankruptcy. That’s up 24% since last year and the highest it has been since 2011, when the Great Recession had the country in its grip.
A combination of factors is stretching farmers to the limit. One is the ongoing trade war with China, which has resulted in steep Chinese tariffs against U.S. farm products. That has tanked exports and made it hard for farmers to plan for next year. At the same time, commodity prices are low and harsh weather has limited the harvest.
“Farmers and ranchers struggle with a prolonged downturn in the farm economy that’s been made worse by unfair retaliatory tariffs on U.S. agriculture as well as two consecutive years of adverse planting, growing and harvesting conditions,” said a spokesperson for the Federation.
The government has announced almost $30 billion in bailouts, but not everyone will be able to take advantage of the money. That said, this year about 40% of farm income is expected to be from bailout funds, the farm bill programs, disaster aid or crop insurance.
A Chapter 12 bankruptcy could turn things around
Filing a Chapter 12 bankruptcy can help many farmers get back on their feet after a tough few years. It allows you to propose an affordable plan to repay your debts over a period of time. Once you’ve successfully completed that plan, any remaining debts are discharged.
The first thing you will notice when you file Chapter 12 is that the creditor phone calls will end. Once you’ve filed for bankruptcy, creditors may no longer attempt to collect from you except through the bankruptcy process. They can no longer file actions to garnish your wages or place liens on your property. They can no longer contact you in any way.
You don’t have to lose your farm to file Chapter 12. Many people are allowed to operate the farm as a “debtor in possession” while they work to pay down their debts.
Don’t let circumstances beyond your control put your farm in foreclosure. Mr. Ford has considerable experience representing farmers and dairy operations in both Chapter 11 and Chapter 12 reorganizations. Save your farm by discussing your options for debt relief with an experienced attorney at Law Offices of Buddy D. Ford, P.A.