Farm Bankruptcy Attorney in Fayetteville and Fort Smith, Arkansas

If you're a family farmer or fisherman struggling with financial hardship, bankruptcy might feel like a dreaded word, but Chapter 12 bankruptcy exists to support individuals like you. Tailored for the unique financial rhythms of farming and fishing communities, Chapter 12 bankruptcy allows you to consolidate and manage your debts without losing your livelihood.

If you live in Fayetteville, Fort Smith, or the Arkansas River Valley area, and your financial circumstances are forcing you to consider Chapter 12 bankruptcy, our bankruptcy attorney at Bond Law Office offer the advice and guidance you need.

We have been helping people facing financial difficulties for the past three decades and can help you determine whether Chapter 12 bankruptcy is right for you.

What Is Farm Bankruptcy? 

Farm bankruptcy, primarily under Chapter 12 of the Bankruptcy Code, is specifically designed for "family farmers" and "family fishermen."  

This chapter allows eligible filers to reorganize their debts and create a manageable repayment plan spanning three to five years. This approach enables farmers to retain their assets and keep their operations running while they repay their creditors. 

Chapter 12 bankruptcy laws were created due to the recognition that farmers and fishermen often have seasonal incomes and specific debt structures that do not conform to other bankruptcy chapters like Chapter 11 or Chapter 13.  

Consequently, Chapter 12 offers tailored provisions that consider the agricultural sector's unique economic cycles and financial requirements. 

Qualifying for Chapter 12 Farm Bankruptcy 

Though Chapter 12 is earmarked for the “family farmer” and the “family fisherman,” an operation run as a partnership or corporation may still qualify. For a partnership or corporation to qualify, more than half of the stock or equity must be owned by one family, or by one family and its relatives. The stock cannot be publicly traded. 

In addition to the debt limitations, those filing for Chapter 12 bankruptcy must receive at least 50 percent of their income from their farming or fishing operations. A husband and wife can file jointly or as an individual. If you file for Chapter 12 as an individual, your spouse’s income must be submitted as part of your petition. 

Additionally, you must have a regular annual income, which may be seasonal, to support a repayment plan. 

As with all bankruptcy filings, you must attend a certified credit counseling course before filing. Also, if you've been dismissed from a bankruptcy filing within the past 180 days, you will need to wait until that window passes to file again.  

Filing a Chapter 12 Farm Bankruptcy Petition 

When filing a Chapter 12 bankruptcy petition, you need to include detailed information regarding your financial situation. This includes: 

• A comprehensive list of all creditors and the amounts owed 

• Detailed documentation of your sources of income, the amounts, and their frequency 

• An exhaustive list of all your property 

• A precise account of your living expenses and farming/fishing-related expenses 

Chapter 12 Bankruptcy Process 

When you decide to file for Chapter 12 bankruptcy, it's important to understand the steps you will encounter throughout the process. These include:

1. Automatic Stay 

Once you file for Chapter 12 bankruptcy, an "automatic stay" immediately takes effect. This stay halts all collection attempts by creditors, including temporary foreclosure and repossession actions, providing you temporary relief and space to restructure your finances. 

2. Creditors' Meeting 

Within 21 to 35 days after filing the petition, your bankruptcy trustee will schedule a creditors' meeting, which you must attend. This meeting lets your creditors and the trustee ask questions about your financial situation and the proposed repayment plan. 

3. Creating the Repayment Plan 

You must submit a repayment plan within 90 days of filing your petition. The plan should allocate all your disposable income—calculated as your income minus necessary living and operational expenses—towards repaying your debts. The plan must ensure that creditors receive at least as much as they would have if you had filed for Chapter 7 liquidation. 

A well-constructed repayment plan balances your ability to continue your farming operations while making feasible debt repayments. This balance is vital for the sustainability of your business and the successful completion of your bankruptcy plan. 

4. Confirmation Hearing 

Your bankruptcy trustee will review your proposed repayment plan and all your supporting documents and recommend it to the bankruptcy court. Within 45 days of submitting the plan, the court will hold a confirmation hearing to approve or request revisions to your proposal.

After the plan is confirmed, you are responsible for making monthly payments to the trustee, who will disburse the funds to your creditors. 

5. Discharge of Debts 

Upon completing your repayment plan, you will receive a discharge, which releases you from any remaining eligible debts. However, certain obligations, like student loans, most taxes, and child or spousal support, are generally non-dischargeable and must continue to be paid. 

Why Choose Bond Law Office 

At the Bond Law Office, Attorney Stanley Bond has over 30 years of experience in handling bankruptcy cases. Our deep understanding of farm bankruptcy, particularly Chapter 12, positions us as trusted advisors capable of guiding you through every step of the process. Some of the services we offer include the following:

• Personalized consultations: Each farmer's financial situation is unique, and we take the time to understand your specific needs and objectives. Our personalized consultations allow us to help you tailor strategies to your circumstances. 
  

• Comprehensive support: From filing an initial petition to developing and implementing your repayment plan, we provide full support throughout each part of the bankruptcy process. We aim to help you alleviate your financial burden so you can focus on your farming operations. 
  

• Skilled negotiation: Our experienced attorney is adept at negotiating with creditors and trustees on your behalf. He will strive to help you achieve the most favorable terms for your repayment plan. 
  

• Community-based service: With offices in Fayetteville and Fort Smith, Arkansas, we serve farming communities throughout the Arkansas River Valley, including Harrison, Eureka Springs, Clarksville, Waldron, and Mena. Our local knowledge and commitment to the community mean we are fully invested in your success in Arkansas.