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Bankruptcy

Chapter 12 bankruptcy

Chapter 12 of the Bankruptcy Code is designed for "family farmers" or "family fishermen" with "regular annual income." It enables financially distressed family farmers and fishermen to propose and carry out a plan to repay all or part of their debts. Under chapter 12, debtors propose a repayment plan to make installments to creditors over three to five years. Generally, the plan must provide for payments over three years unless the court approves a longer period "for cause."

In Alabama, Chapter 12 of the Bankruptcy Code is tailored to meet the specific needs of family farmers and family fishermen who have a steady annual income but are facing financial distress. This chapter allows these individuals to create and implement a repayment plan to settle their debts over a period of three to five years. The plan typically requires payments to be made over three years, but the court can extend this period if there is a justifiable reason. The goal of Chapter 12 is to enable family farmers and fishermen to continue their operations while managing their debt obligations. This provision recognizes the unique financial challenges faced by those in the agricultural and fishing industries and provides a mechanism for debt relief that is more suited to their circumstances than other chapters of the Bankruptcy Code.

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Bankruptcy

Chapter 12 bankruptcy

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Bankruptcy

Chapter 12 bankruptcy

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