CHICAGO, Ill. (Reuters) — U.S. agricultural lenders fear more farm bankruptcies this spring, and Midwest lawyers want to raise the debt limit for Chapter 12 “family farmer” bankruptcies.
Chapter 12, created during the 1980s farm crisis, is a simple court procedure to let farmers keep operating while working out a plan to repay lenders.
The limit is $4 million, and the lawyers want it increased to $10 million to recognize today’s larger farms.
Without a new limit, farmers would be forced into a Chapter 11 filing, which is more costly and onerous.
