Chapter 12 bankruptcy allows a debtor to pay off adjusted debts if they are a “family farmer" or a “family fisherman." Chapter 12 allows a farmer or fisherman to adjust and make payments on their debt without foreclosure or sacrificing the assets including those that support their livelihood.
Chapter 12 bankruptcy is very similar to a Chapter 13 bankruptcy. In order to qualify to file Chapter 12 bankruptcy, a debtor must be a farmer or commercial fishermen and make a regular annual income that can support bankruptcy payments. The process lasts typically three to five years. There are minimum limits on the amount a farmer or fisherman must make annually in order to qualify for Chapter 12. Chapter 12 is the rarest and most uncommon form of bankruptcy filed in the United States.