The bankruptcy laws we have were written to protect people from debt and to help give them the ability to get a new start. That's exactly why there are so many different kinds of bankruptcy, tailored to meet the needs of different individuals or corporations.

People whose livelihoods depend on their family farm are able to file a Chapter 12 bankruptcy. Chapter 12 bankruptcies are made for family farmers and fishermen who have more debt than they can handle. A Chapter 12 bankruptcy is more similar to a Chapter 13 bankruptcy for individuals than a Chapter 11 corporate bankruptcy, but is designed for family farmers who own their own businesses and therefore have larger amounts of debt.

So, how does a Chapter 12 work? A Chapter 12 bankruptcy is like a Chapter 13 in that it lets the family farmer pack all of their debts into a single payment plan. Moreover, the payment schedule is tailored to the farmer's way of life and is dependent on the seasons just like a farmer's income is. Like a Chapter 13 bankruptcy, you are able to keep your property, your farm, and creditors are no longer allowed to call. Best for family farmers is that the limit for the total amount of debt you are allowed to have in order to qualify is way higher than a Chapter 13 bankruptcy.

How do you know if you qualify? In order to qualify for a Chapter 12 bankruptcy you must have a specifically family run farm. Now, a Chapter 12 isn't going to provide protection to huge agri-buisness operations. Second, the family farmer can't owe above about.7 million dollars in both secured and unsecured debt. That is almost three times more than the debt limits for a Chapter 13 bankruptcy, which is why a Chapter 12 is so appealing to family farmers. As I mentioned, a Chapter 12 is made for family farmers: the bankruptcy court hears the difficulties that farmers face and understands why they usually have more debt and average individuals.

A family farmer bankruptcy can be a real second chance for farmers who fell behind. Your creditor calls will end and you can get help for your debt, but most importantly, you can prevent losing your farm. A Chapter 12 bankruptcy will help you preserve the farm that you have spent your life working hard for and will in turn preserve your family's source of income.