Financial hardships such as medical expenses, job loss and increases in the cost of living are common reasons for declaring a Chapter 7 bankruptcy. This type of bankruptcy allows most people to retain the majority of their property. Readers in Jackson, Mississippi, will be interested in the following account of a farm owner filing for Chapter 7 bankruptcy.
The owner of a farm in another state has filed for Chapter 7 bankruptcy, citing financial problems due to crop damage. This business is a Community Supported Agriculture farm that has been in operation for 61 years. The owner made it clear that his family would find a way to continue farming.
The farm closed in December 2012, resulting in the dismissal of more than 50 employees. The coordinator for the farm’s CSA membership confirmed on Jan. 5 that the farm had ceased all operations.
The bankruptcy was filed on Dec. 28, and the paperwork showed the farm’s liabilities to be between $1 million and $10 million, with assets of between $500,001 and $1 million. The filing also estimated that the farm had between 200 and 999 creditors. The farm is required to provide a statement of its financial affairs by Jan. 11.
While this farm is not in Mississippi, its reasons for filing bankruptcy could easily face farmers in our state. Those filing for Chapter 7 bankruptcy should know that it eliminates unsecured debt such as medical bills and credit card debt. Debtors in these cases also have the option of retaining property by paying the past due and current balance on secured debt.