Farmers Home Administration:
Farm Loans to Delinquent Borrowers
RCED-94-94FS: Published: Feb 8, 1994. Publicly Released: Feb 8, 1994.
- Full Report:
Pursuant to a congressional request, GAO provided information on the Farmers Home Administration's (FmHA) direct and guaranteed farm loan programs, focusing on the: (1) levels of outstanding debt, delinquencies, and losses on farms loans, and (2) extent that FmHA has approved direct or guaranteed loans to current and previously delinquent borrowers.
GAO found that: (1) of the $18.8 billion in outstanding FmHA direct and guaranteed loans to U.S. farmers in 1993, $5.4 billion was held by delinquent borrowers; (2) between 1991 and 1993, FmHA lost a total of $5 billion due to reductions in the delinquent debt of direct loan borrowers and paid a total of $160 million in losses on guaranteed loans; (3) between 1991 and 1993, FmHA made new loans totalling $55 million to 936 borrowers that had their delinquent loans reduced or forgiven and $60 million in new guaranteed loans to 408 borrowers after it incurred losses on their previous guaranteed and direct loans; (4) as of September 1993, nearly 21 percent of the previously delinquent borrowers were delinquent on their new direct loans and about 4 percent of the borrowers that received new guaranteed loans were delinquent on their loans; and (5) FmHA made additional loans totalling $90 million during fiscal years 1991 to 1993 under a policy that allows delinquent borrowers to obtain new direct loans for operating expenses.