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marketeye
Veteran Advisor

Debt Limit Raised

On Friday, August 23, 2019, the President signed into law:

H.R. 2336, the “Family Farmer Relief Act of 2019,” which increases the debt limit used to determine whether a family farmer is eligible for relief under chapter 12 of the Bankruptcy Code;

 

What say you?

 

Mike

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11 Replies
BA Deere
Honored Advisor

Re: Debt Limit Raised

Don`t like it.  Don`t like raisin $4 million debt to $12 million, maybe those with a $12 million debt and in trouble wouldn`t be too hurt to work a real job for a few years.  But, you know what this is, don`t you?  It`s a bank bailout, make everyone have to share in the pain of a write-down of a highroller.

Maybe I shouldn`t complain, it`ll hold up land values for all of us, but it frosts me that a chosen few figured out "alchemy".

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sdholloway56
Senior Advisor

Re: Debt Limit Raised

That's some pretty funny stuff there.

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sdholloway56
Senior Advisor

Re: Debt Limit Raised

Objectively, should not be popular with the vast majority of people who are farming. It is a competitive game.

Although neither should an estate tax exemption of $10M.

But if you're an heir who is looking at the NW total on his/her balance sheet it is all good.

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sdholloway56
Senior Advisor

Re: Debt Limit Raised

I do still feel for the many friends back in the 80s who stood at parade rest for the court martial while they blew taps.

Later found out they didn't really have to.

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BA Deere
Honored Advisor

Re: Debt Limit Raised

The way I feel about it, you should be 110% honest with your lender, if you feel you have to lie "a little" to get an operating note, you are on the road to perdition already.   And that was the case for the golden boys in the early 1980`s they had $40,000 feed bills at the elevator, all kinds of fertilizer bills at every supplier that would extend them credit.  The honest man sat down with his banker and laid it all out and probably came to the conclusion in 1984 that the hole was impossible and only getting deeper with 18% interest rates, well, he had a farm sale, his 4020 brought $4,000 and his farm brought $1200/acre, but he paid everyoine off before it got deeper and put mainstreet businesses out of business.

Those that lied, cheated and stole until 1987 got an elevator ride out of their deep hole and promptly bought some of that $1200/acre land before it went up and of course remodeled or built a new house with their newly acquired, ill gotten gains.  All thanks to the chapter 12 and debt write offs. Now history will perhaps rhyme with their sons and grandsons getting 36 row planters and commercial capacity bin sites debts written off.

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rsbs
Veteran Advisor

Re: Debt Limit Raised

yep Ba, and that $1200 was actually lowered to $800 for land they owed on, as the Farm Credit services deemed it would take about a third of the value to foreclose on them and wait out the two year redemption period.

So any big wheel in the 80's came out of the decade with an average land debt of $800 or less. Anyone that tells you differently is like the pale skin blue eyed lady speaking with forked tongue.

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hereexact9681
Frequent Visitor

Re: Debt Limit Raised

Don't see how this could save any businesses that are almost dead.I mean, anything is better than nothing, but still, if the help was given earlier, more businesses would have survived this pandemic. I have signed for two loans with https://www.yhdistalaina.com/, and I will most probably have to pay them back to years ahead, but at least I saved my business. I hope that our Government will be able to handle these kinds of situations in the future and that the private sector won’t have to suffer as much as it did the last two years. Otherwise, we risk losing our economy! 

sw363535
Honored Advisor

Re: Debt Limit Raised

while they pay city folks to not work.......... this is what rural citizens get for electing fools for leaders.

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lsc76cat
Veteran Advisor

Re: Debt Limit Raised

Most rural counties in the US are "red".  Most metro areas are "blue".

As I've mentioned before elections are tipped more towards urban vs rural.

Perfect example is California where about 2/3 of the counties in the state are trying to secede from the rest.

But then Kansas, Minnesota and quite a few other states have the same problems.

These metro areas need to be separated from the rest of the tax base.

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