From Debt to Deliverance: Paul and Linda
Note: This is the second of a three-part blog series about ABLS clients and their debt resolution stories.
In March we shared the story of retired Iowa farmers Jerry and Deb and the debt restructuring plan we developed for them. In this blog meet another Iowa farm couple, Paul and Linda.
An average crop in 2012, a worse crop in 2013 and no crop in 2014 was the beginning of Paul’s and Linda’s woes in eastern Iowa. Paul described what happened next:
“We lost one of the farms that we were (working), and that was a third of our acreage for farming. So we didn’t have enough acres to cover our leftover expenses the following year. Plus, the co-op we were working with was hedged-to-arrive and had a change of management, and those people didn’t understand hedge-to-arrive, and forced us to sell at a high tide and we were on the wrong side of the market. That left a deficit that was impossible to overcome.”
On top of that, the couple’s bank had a change in management. The new management didn’t understand farming. Paul told bank managers if they wouldn’t work with him on loan repayment he would have to declare bankruptcy and face a tax bill he and Linda couldn’t afford.
Body shop, healthy body, and hope
We first met with the couple in 2015, shortly after Linda was diagnosed with a form of blood cancer. We determined they couldn’t work through their debt issues outside of bankruptcy, even with the income Paul received from his body shop business.
Paul and Linda filed for Chapter 12 in April 2016, and the bankruptcy court confirmed their reorganization plan in early 2017. Paul was able to continue running his body shop and, in fact, has expanded his business. Linda is now cancer-free and sells essential oils. The couple no longer farm but still live in their home post-bankruptcy, and the Chapter 12 addressed their tax bill.
It all works out
“I grew up on a farm and farmed for 40 years. It was a way of life,” Paul says. “To stop farming was very difficult, but when you have someone like Joe Peiffer reassuring you that everything will work out, it was an easy decision to file Chapter 12.”
If farm debt is becoming unmanageable for you, be proactive and reach out to us. Don’t wait – do it today.
At Ag & Business Legal Strategies, we want our clients to be honest with themselves and have a solid business plan. Our attorneys and financial strategist will help you create and execute that business plan, and, if necessary, assist you with the legal, tax, and practical aspects of debt restructuring or bankruptcy.
Don’t wait for the problems to become insurmountable. Connect with someone you can trust today, not tomorrow.
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Categories: Chapter 12, Testimonials
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