Chapter 12 bankruptcy is intended for family farmers and family fishermen. Family farmers and fishermen are designated to one of two categories. The first category includes an individual or an individual and his or her spouse. The second includes corporation and partnerships.

For individual and individuals and spouses seeking relief under Chapter 12 of the Bankruptcy Code, they must meet specific criteria. Also, corporations and partnerships seeking relief under Chapter 12 of the Bankruptcy Code must meet specific criteria.

A debtor or debtors seeking relief under Chapter 12 must file a petition with the bankruptcy court. The debtor’s repayment plan for debts must be submitted to the court within 90 days of his or her petition filing. The debtor or debtors are typically required to provide information pertaining to assets and liabilities, current income and expenses, unexpired leases and contracts, and a statement of financial affairs.

The debtor or debtors must also provide the court with other information to complete the entire petition. According to the U.S. Courts, this information includes a list of creditors and the amounts of their claims, the debtor’s income information, a list of the debtor’s property, and a thorough list containing the debtor’s monthly farming and living expenses.

Under the new Bankruptcy Law, effective since October 17, 2005 , there is a case filing fee and an administrative fee for those seeking relief under Chapter 12 of the Bankruptcy Code. According to the administrator of the U.S. Courts, the filing fees total $239 for Chapter 12 bankruptcy.

Most collections will decease when the debtor files a petition for Chapter 12 Bankruptcy. The court will appoint an impartial trustee to oversee the case. The trustee will arrange for the debtor as well as all of the creditors to meet. At this meeting the creditors are allowed to ask the debtor questions pertaining to his or her financial situation and repayment plan.

In most Chapter 12 Bankruptcy cases, the debtor will only pay a portion of his or her debt. Creditor’s claims are divided into three different categories. These categories include priority claims, secured claims, and unsecured claims. Under Chapter 12 Bankruptcy, all priority claims must be paid in full unless there is an agreement that states otherwise. Unsecured claims do not have to be paid in full. Secured claims are paid with the collateral set forth for the debt. The debtor is given three to five years to complete the repayment plan.