It's down to farm loans or bust!

[LCCattle]

Farmers will get $500 million from USDA to help them cover farm ownership loans, officials told AgDay.
Producers are facing reluctance from banks to lend because of lower commodity prices and declining farm incomes. That is pushing up demand for USDA’s guaranteed loans.
And it could get even harder for farmers. USDA is nearly out of the $2 billion approved by Congress for the program.
http://www.agweb.com/article/usda-to-ai ... ra-beachy/

 

[Nesikep]

Like heck we'll ever see a dime

 

[TexasBred]

Farmers will get $500 million from USDA to help them cover farm ownership loans, officials told AgDay.
Producers are facing reluctance from banks to lend because of lower commodity prices and declining farm incomes. That is pushing up demand for USDA’s guaranteed loans.
And it could get even harder for farmers. USDA is nearly out of the $2 billion approved by Congress for the program.
http://www.agweb.com/article/usda-to-ai ... ra-beachy/

Another copy and paste.

 

[bmoore87]

Unfortunately I think this is probably the way things are going t be going with it taking more and more capital to get a start in farming even before commodity prices started going down because of the high cost of land and inputs. Around here talking with banks even if you have a good chunk saved or amount of equity built up they still want you to try and go for a USDA guaranteed loan through them since it reduces their risk away especially for younger farmers.

While farmers benefit from this some the banks do alot.

 

[Bigfoot]

I hear people talk about the "bail out" back in the 80's. What did that amount to, and how did it work?

 

[LCCattle]

There's allways farm aid.
https://www.youtube.com/watch?v=VLpa8-hsuV0

 

[Anonymous]

1980s Bad memories ! by 84 banks wouldnt hardly talk to you if want more than a car loan ! if you told some you were a farmer they would give you a number for suicide hot line ! sorry had to take deep breath .low intrest loans came with strings attached .as long as did thing the way the gov wanted it done .you got what you wanted or needeed biggest mistake was submitting the lowest i could take to operate ,they made a game of it like an auction only instead of going up we were going down !But my problem was i wasnt wanting to do things there way .some one else can give you details .all i can tell is my experience by the time i was done my first year with dealing with the government 1983 the man on the other side of the desk ask me if i had any questions .my question ..yea let make sure i got it straight so if i had walked in wanting to BUY 1000 or more acre buy all top livestock build all new buildings ,buy the bigest new equipment and plan to double in size next year i would walk outa here with what ever i wanted . his answer .NOOOO! NOT AT ALL JUST IF YOU SHOWED YOUR GOING TO MAKE THIS VIABLE AN SIZEABLE OPPERATION .then yes you would have been looked at more favorable!
as i got UP to walk out i look at him an said. Thats exactly what i thought !
as far dairy buy out it worked out good for most some of the other programs were ok ,but if you were small time ...NO

 

[Anonymous]

ooh i need to add my problem was i want to still do it ,they wanted most of us out ! they only liked the biggest operations their were a lot crosses in Greensburg courthouse lawn.(scarecrow in the rain ) those were faimly operations https://youtu.be/joNzRzZhR2Y !

 

[BrandX]

I am not sure I understand what the above comment is about, but as a recent USDA loan applicant I will weigh in. My wife and I got a beginner farm loan through the USDA for operating. We also have one in the works to purchase 110 acres at $1350/ac for a total of $146,880 for the land. We will run our 15 head or so on it. Of those 15 or so I have a USDA farm operating loan of $10,000 which bought us 8 black bred cattle, we already owned to others and the bull. Good or evil is not really the point, there is NO WAY we could have gotten started any other way. From what I gather looking at statistics most of the farmers and ranchers here in America are 55 and older. The USDA is trying to fill a hole in the industry that it sees coming due to an aging population and the lack appeal for new entrants to the lifestyle. Not many young people want to invest all their money and time into an activity that that cost you everything pays back very little and has a huge chance to lose everything due to weather. The USDA is the only ones(around here anyway) promoting and offering ways into farming for people. the banks have dropped the ball in funding programs because it is too risky. Where are the associations from private industry(magazines, beef check off, breeders, ect.) offering credit, capitol, or scholarships? The agriculture industry as a whole needs to bee more proactive in getting the next generation interested in the rural lifestyle or soon all of our food will be imported. The USDA is not good or bad they are just filling a need.

 

[Cross-7]

My job is directly related to farming and based on sales, what our customers and their customers saying.
Low commodity prices are making things very tough.
Operating loans don't pencil out at current prices.
The guys that have some things paid for and some equity built up are trying to stay in, but the guys that haven't been in long enough and have debt are struggling.
Can't explain that to my boss but it's really tough right now.

Last week cash wheat was 3.16 in SW OK.
20-30 bushel wheat won't pay expenses.
Cotton isn't any better and the expenses are 3 times as much vs wheat.
I heard a million more acres of corn went in this year so that should drive the price down more.
The cattle market is looking like it's going crash.
Ag right now is tough

 

[backhoeboogie]

I hear people talk about the "bail out" back in the 80's. What did that amount to, and how did it work?

People went broke. Belly up. Some had been in the business 40 years. Others only 25 or so. Nothing worked. People went to work. In industries they knew nothing about. They had no choice. That's how I remember it.

 

[True Grit Farms]

Taxpayers shouldn't finance private business, and it's not the government's job to put anyone in business. The government is keeping everything artificially high and interest rates low. There's no way that 20-30 cows can pay for $146k loan, that's a terrible investment of taxpayers dollars.

 

[backhoeboogie]

Taxpayers shouldn't finance private business, and it's not the government's job to put anyone in business. The government is keeping everything artificially high and interest rates low. There's no way that 20-30 cows can pay for $146k loan, that's a terrible investment of taxpayers dollars.

Not 20 to 30 cows. But 50 could. If you already have the land. $146 at 4.5% interest on a ten year note is $1513 a month (2 calves). 50 head should yield almost 4 calves a month. Fertilizer, meds, fuel, taxes is going to cost around 1 calf per month. You cannot live off of the other 1 calf per month but you could supplement yourself.

10 years from now the loan is paid off and you get 3 calves per month. I have more expensive taste than that but it is supplement.

I am not opposed to borrowing money if it pencils out. I went several years pocketing around $400 per month but building equity in land. I wound up selling one place for more than double what I had paid 3 years prior. No way I could have bought that place without a loan.

 

[LCCattle]

Farmers will get $500 million from USDA to help them cover farm ownership loans, officials told AgDay.
Producers are facing reluctance from banks to lend because of lower commodity prices and declining farm incomes. That is pushing up demand for USDA’s guaranteed loans.
And it could get even harder for farmers. USDA is nearly out of the $2 billion approved by Congress for the program.
http://www.agweb.com/article/usda-to-ai ... ra-beachy/

Another copy and paste.

I noticed you and maybe some others have made that comment. So I will assume you are unfamiliar with the Fair Use Act which could cause you to end up with your teat in a wringer along with the board owner. So, when you see a cut and paste in quotes from me as proof of my position or as a new topic to discuss, by law, I must give credit to the source as it is their property. And to give credit it must be in quotes along with the URL. Plus the URL tells all readers where to go to read the entire article if they wish.
Some boards that I am a member will kick you off if you do not follow the Fair Use Act, so that is why I cut and paste, to follow the law.
So I strongly suggest you familiarize yourself with the Fair Use Act along with board rules.

“ Fare Use Act “
http://fairuse.stanford.edu/overview/fa ... -fair-use/
YEP! Another cut and paste, and I will continue to obey the law no matter how many times you witch about it.
And not to beat a dead horse, but every time you hit the quote mark to quote someone, you are doing a cut and paste.

 

[Bigfoot]

I always heard there was a debt write off back in the 80's. Similar to a bankruptcy, but not the same. You just walked in the FSA office, and signed the paper work, and walked out debt free (on your loan to the govt. anyway). You went home, and picked up where you left off. I still hear it talked about, by many people. I would like to read about it, but can't find any information. Maybe it didn't exist? Hard to believe that's the case, when I've heard about it all my life.

 

[Cross-7]

Farmers will get $500 million from USDA to help them cover farm ownership loans, officials told AgDay.
Producers are facing reluctance from banks to lend because of lower commodity prices and declining farm incomes. That is pushing up demand for USDA’s guaranteed loans.
And it could get even harder for farmers. USDA is nearly out of the $2 billion approved by Congress for the program.
http://www.agweb.com/article/usda-to-ai ... ra-beachy/

Another copy and paste.

I noticed you and maybe some others have made that comment. So I will assume you are unfamiliar with the Fair Use Act which could cause you to end up with your teat in a wringer along with the board owner. So, when you see a cut and paste in quotes from me as proof of my position or as a new topic to discuss, by law, I must give credit to the source as it is their property. And to give credit it must be in quotes along with the URL. Plus the URL tells all readers where to go to read the entire article if they wish.
Some boards that I am a member will kick you off if you do not follow the Fair Use Act, so that is why I cut and paste, to follow the law.
So I strongly suggest you familiarize yourself with the Fair Use Act along with board rules.

“ Fare Use Act “
http://fairuse.stanford.edu/overview/fa ... -fair-use/
YEP! Another cut and paste, and I will continue to obey the law no matter how many times you witch about it.
And not to beat a dead horse, but every time you hit the quote mark to quote someone, you are doing a cut and paste.

I'd personally like you hear your own thoughts and your take on the afore quoted link
Instead of someone else's thoughts

 

[JMJ Farms]

I always heard there was a debt write off back in the 80's. Similar to a bankruptcy, but not the same. You just walked in the FSA office, and signed the paper work, and walked out debt free (on your loan to the govt. anyway). You went home, and picked up where you left off. I still hear it talked about, by many people. I would like to read about it, but can't find any information. Maybe it didn't exist? Hard to believe that's the case, when I've heard about it all my life.

It happened. At least to some folks. One neighbor owed $600k. They wiped his slate clean.

Another neighbor borrowed cheap USDA or SBA (not sure which) money at 3% and loaned it to the bank at 20%. Made a killing. But he wasn't supposed to.

 

[True Grit Farms]

I always heard there was a debt write off back in the 80's. Similar to a bankruptcy, but not the same. You just walked in the FSA office, and signed the paper work, and walked out debt free (on your loan to the govt. anyway). You went home, and picked up where you left off. I still hear it talked about, by many people. I would like to read about it, but can't find any information. Maybe it didn't exist? Hard to believe that's the case, when I've heard about it all my life.

I want my share of that Bigfoot. I busted my back and broke my but to pay all my loans off in full. Some took me as long as 14 years and $200k in interest alone but I did it. Back in the day I had to have 20% of the purchase price in cash just to receive a loan from a bank.
JMJ Farms there's a bunch of crooks living amongst us. If you steal from the government your stealing from me.

 

[Anonymous]

there were write offs but like i said there where dos and there were donts some did cheat the system and no one cared ,like i said Bigfoot they wanted most us small producers out the ones that wanted to stay in were treated as the bad guys.unless your operation was large .and even then some had to fight for it .
BrandX yea for some its the only way to start and now a days they have changed the way they do business so im pulling for you keep close eye on things an you will be ok !,but when you already have a bank loan on land ,have bills at the local mill or any other supplier an couldnt pay . cause cows , pigs and whatever else includeing day job wasnt enough to cover all the bills.it wasnt pleasent !
Keep in mind that large amount is going to get spread out in diffrent directions,if i sat an picked the cobwebs off i could tell you how they split it in 80s it didnt seem fair then but its the gov.
got out from under there thumb in early 90s.one small catch i cant go back to them ,one of the donts and my intrest was any where from 6.7 an up but it was cheaper than a bank ,but they wouldnt talk to most farmer in thoses days.

 

[BrandX]

The reason USDA loans are attractive is that the interest rates are 2.8%-3.5%. That is way less than a bank or credit union will do. They were 6.5%. plus the loans are due monthly they are due once a year from when you close the deal. So we pay $146 at 3.5% for 40 yr = $6700 a year. The cattle loan is $10,000 for 7years at 2.8% = $1,500 a year

Bigfoot: the USDA does not require any collateral to get a loan. We did not have to put our house or the vehicles or anything like that, so yes if the world goes belly up a person would be able to "walk away from their debt". Your credit score would be shot for 7 years, but I guess that may not really matter.

TGF: as far as it being a terrible waste of tax payers dollars. I have to think you are wrong. 1) there are a whole slew of highly paid and well educated government employees that look at and processed or loan. I think if it were a bad business plan they would not approve it AND pay for it since it is their money. 2) Governments have been putting people in business and power for eons. Think East India Trading Company. 3) My guess is that they look at it more as safe guarding americas interests and being food independent.If you think being energy dependent is bad for national security that imagine being food dependent.