Immediate assistance to over 13,000 needy USDA agricultural loan borrowers.Begins process to provide up to $500 million in additional loans to up to 23,000 additional borrowers
Washington, October 18, 2022 – The United States Department of Agriculture (USDA) announced today that needy borrowers taking out eligible USDA agricultural loans as part of $3.1 billion in assistance to needy agricultural loan borrowers provided through Section 22006 of the Inflation Reduction Act. announced that it has already received nearly $800 million in support. (IRA). The IRA has directed the USDA to facilitate assistance to borrowers of direct or insured loans administered by USDA’s Farm Service Agency (FSA) facing financial risk.
Today’s announcement begins the process of providing assistance to distressed agricultural loan borrowers using several complementary approaches. Its purpose is to preserve agriculture, remove the obstacles that currently prevent many of these borrowers from returning to agriculture, and improve the way USDA borrows. service. Through this assistance, USDA is focused on creating long-term stability and success for difficult borrowers.
“Our country’s farmers and ranchers have faced some very tough times over the past few years, and it’s not their fault,” said Agriculture Secretary Tom Vilsack. of agriculture and help provide a fresh start for struggling growers.”
Work has already begun to bring some relief to needy farmers. As of today, more than 13,000 borrowers benefit from resources provided under the Inflation Control Act, including:
- About 11,000 delinquent direct and guaranteed borrowers have liquidated their accounts. USDA is also giving these direct loan borrowers the next scheduled annual installments, giving them peace of mind in the short term.
- About 2,100 borrowers whose farms have been foreclosed and are still in debt have settled this debt in order to stop the debt collection and foreclosure that is making a fresh start more difficult.
In addition to the automatic assistance already provided, USDA also outlines procedures for administering up to $500 million in additional payments to benefit needy borrowers such as:
- USDA used the COVID-19 Pandemic Relief Fund to manage $66 million in separate automatic payments and moved scheduled payments to the end of the loan during the pandemic using the FSA’s Contingency Option Supports up to 7,000 direct loan borrowers.
- The USDA is also initiating two case-by-case processes to provide additional assistance to agricultural loan borrowers. Under the first new process, the FSA will review and assist in arrears from 1,600 complex cases, including those where borrowers are facing bankruptcy or foreclosure. A second new process will use existing Direct Loan Service standards and add new options to intervene more quickly to reach an estimated 14,000 financially distressed borrowers seeking help to avoid delinquency. We support.
As with other USDA assistance, all of these payments are reported as income and borrowers are advised to consult their tax advisor. USDA also has resources and partnerships with collaborators who can provide additional assistance and help borrowers navigate the process.
Today’s announcement improves lending services efforts at the USDA by providing assistance to distressed agricultural loan borrowers, accommodating farmers, adding more tools and easing unnecessary restrictions This is just the first step in USDA’s efforts to Additional announcements and investments in support will be made as USDA implements these additional changes and improvements.
This effort will also eventually include adding more tools and easing unnecessary restrictions through support made possible by Congress through the IRA. Further assistance and changes to the approach will be made in subsequent phases.
USDA provides access to credit for approximately 115,000 growers who are unable to obtain sufficient commercial credit through direct and guaranteed agricultural loans. No Includes farm storage facility loans or marketing assistance loans. The funds and direction Congress provided in Section 22006 of the IRA allow the USDA to qualify its operations for financial risk while undertaking work that will, in the long term, transform the way the USDA provides loan services. has taken steps to provide relief to some distressed borrowers. Borrowers are provided with the flexibility and opportunity they need to manage the inherent risks and unpredictability of farming and maintain good financial standing.
January 2021, USDA has suspended foreclosures and other adverse actions against direct farm loans due to the pandemic, encouraging insured lenders to follow suit. Last week, the USDA issued a request to insured lenders to provide time to make available full assistance to distressed borrowers in the IRA before lenders take irreversible action. repeated.
The producer farmers.gov farm loan discovery tool (Also available in Spanish) or by contacting them Local USDA Service CenterProducers may also call the FSA Call Center at 877-508-8364 between 8am and 7pm ET. The USDA has tax-related resources available at: farmers.gov/taxes.
USDA touches the lives of all Americans every day in so many positive ways. In the Biden-Harris administration, the USDA will transform America’s food system to create more resilient local and regional food production, fairer markets for all producers, safer, healthier and more nutritious food for all communities. The focus is on ensuring access to high quality food and building new markets and flows. Increasing incomes for farmers and producers using climate-smart food and forestry practices, making historic investments in infrastructure and clean energy capabilities in rural America, removing systemic barriers, and making America a better place. Ensure equity across sectors by building a more representative workforce. For more information, please visit the following URL: www.usda.gov.
USDA is an equal opportunity provider, an employer, and a lender.