A crowd is gathered at a farm auction in which a neighbor's farming goods are being sold. The people in the crowd, who are upset because they believe that the bank is selling out the farmer, begin chanting "no sale, no sale." In an effort to calm the situation, the farmer tells the crowd that "they've already foreclosed" on his farm. What does he mean?
Assume that the auction is a result of Chapter 7 bankruptcy proceedings. Was the farmer's petition for bankruptcy voluntary or involuntary? Explain.
Suppose that the farmer purchased the homestead three years prior to filing the petition in bankruptcy and that the current market value of the farm is $215000.
What is the maximum value of equity that the farmer could claim as exempt under the 2005 Bankruptcy Reform Act?
Compare the results of a Chapter 12 bankruptcy as opposed to a Chapter 7 bankruptcy for the farmer.