As a child of the Farm Financial Crisis and having spent my previous professional life in various roles of farm advocacy, I’d heard countless stories from FSA borrowers and former borrowers—heck, even folks that had never applied—recounting their perception of the shortcomings of FSA’s lending efforts. With this rule, we are taking many of these shortcomings off the table, because we believe that the performance of our portfolio can be used as an example for the rest of the ag lending industry. We’ve heard the concerns loud and clear. In response, in recent years, we’ve announced several FSA lending improvements and flexibilities including:
- A new loan assistance tool
- A streamlined application
- Online loan payments option
- A “fast track” loan approval process
And there are more of these farm loan enhancements to come. We’ll visit more when appropriate, but for now I’d like to talk about the rule, and our broader credit reforms. The Biden-Harris administration has clearly demonstrated a dedication to listening to stakeholders and a willingness to promote change. The rule we publish today serves to codify many of the best practices we’ve seen across the country from our staff; while at the same time support our staff in a new approach tailored to the “actual needs” of a borrower.
The rule is part of a holistic effort in support of the Biden-Harris administration’s commitment to our ag producers. Twelve legislative proposals included in the President’s FY 25 Budget were offered as well, several of which are being contemplated by our friends on the Hill during their ongoing deliberations.
You can read the rule changes for yourself in the Federal Register and here’s a one page fact sheet, but I will illustrate the meaningful impact the rule represents by sharing producer sentiments that will hopefully be a thing of the past for agency and the borrowers we serve – concerns expressed like:
“FSA takes every dang thing I have as security; they tie my hands so I can’t make decisions when I need to.”
“I have to work off the place so I can afford to live.”
“Losing the family farm is bad enough, but did they have to take my house?”
The changes in this rule, signal a producer-centric approach to finance. Our tools can now be used to provide borrowers the financial freedom and flexibility to improve profitability and resilience. Allowing the borrower the opportunity and means to save for long-term needs and make strategic investments from their existing production income; can help demonstrate that when the terms of finance meet the “actual needs” of the producer, everybody wins; it’s akin to giving our producers a raise.
Over the next few weeks, we will work diligently to train our staff and inform our stakeholders across the country, to ensure we’re ready for the fall loan season. As always, your patience is appreciated, but please feel free to reach out if you think we can be of assistance here in the national office.
To say that it has been one of the great privileges of my life to contribute alongside our team to this effort, is a woeful understatement.
Many of you have seen the black vest that I wear for my “formal attire.” It belonged to that rancher mentioned at the beginning of this blog. I have worn it to keep me grounded and remind me of my “why.” Its work is done, now it’s time to get my own.
Source : farmers.gov