The US Department of Agriculture (USDA) is now giving debt relief to thousands of farmers who are struggling to make loan payments or are facing foreclosure.
The department announced on Tuesday, Oct. 18, that it has been aiding farmers through the Inflation Reduction Act, which President Joe Biden signed into law in August. The act set aside $3.1 billion for “distressed borrowers” who are at risk of losing their farms.
Since the program began, it has given nearly $800 million to over 13,000 people. The USDA reports that of those people, 11,000 had direct and guaranteed farm loans that were at least 60 days past due as of September 30. With the aid, their accounts are now current. There are also 2,100 borrowers with foreclosed farms who had outstanding debt. And those debts are paid.
The USDA is Considering Giving Aid to Nearly 16,000 More
Moving forward, the USDA will consider extending the relief to more farmers using two case-by-case processes. The first will review 1,600 people who are facing possible bankruptcy or foreclosure due to unpaid loans. And the second could help 14,000 farmers avoid delinquency altogether.
Furthermore, the agency will soon make $66 million in automatic payments to up to 7,000 farmers who took advantage of a measure under the Farm Service Agency that allowed them to move their scheduled payments to the end of their loans during the COVID pandemic.
“Through no fault of their own, our nation’s farmers and ranchers have faced incredibly tough circumstances over the last few years,” Agriculture Secretary Tom Vilsack said in a statement. “The funding included in today’s announcement helps keep our farmers farming and provides a fresh start for producers in challenging positions.”
The Struggling Economy Seriously Impacted Farmers
FSA Administrator Zach Ducheneaux broke down the numbers. And he said that the act gave each approved direct loan borrower about $52,000 in aid to date. And the program has given about $172,000 to each guaranteed loan borrower.
A retooled provision in the act also set aside $2.2 billion for “financial assistance, including the cost of any financial assistance, to farmers, ranchers, or forest landowners determined to have experienced discrimination” prior to January 1, 2021, in USDA farm lending programs.
The USDA gave relief to farmers who they believed were strongly impacted by pandemic-induced economic disruptions or natural disasters.
Ducheneaux clarified that a “distressed borrower” is someone who has been struggling to or has not been able to make farm loan payments. Or, they’re at risk of losing their operations due to bankruptcy or foreclosure.