Issues Surrounding a Secondary Market for Agricultural Real Estate Loans

T-RCED-87-29: Published: Jun 3, 1987. Publicly Released: Jun 3, 1987.

Additional Materials:


Office of Public Affairs
(202) 512-4800

Pursuant to a congressional request, GAO discussed its work involving a secondary market for agricultural real estate loans. GAO noted that the benefits of a secondary market include: (1) enhanced liquidity of financial instruments; (2) more moderate cyclical flows of capital; (3) improved regional flows of capital; (4) reduced regional differences in interest rates; and (5) regional portfolio diversification. GAO also noted that: (1) existing secondary agricultural loan markets are primarily regional and handle a relatively low volume of loans; (2) while the Farm Credit System (FCS) is generally a primary lender, it causes economic effects similar to a secondary market in that it enhances liquidity, reduces the effects of cyclical capital flows, and has enhanced regional capital flow and reduced regional interest-rate differences; and (3) a number of legislative proposals would create a national secondary market entity. GAO believes that any such legislative proposal should: (1) recognize that direct federal involvement in a secondary agricultural loan market would probably be necessary; (2) allow for the impact of a secondary market entity on FCS lenders and borrowers; (3) consider the possibility of establishing FCS as a national secondary market; and (4) ensure reasonable eligibility criteria for potential secondary-market loans.

Sep 4, 2018

Jun 29, 2018

Apr 27, 2017

Apr 13, 2017

Sep 7, 2016

Sep 6, 2016

Aug 24, 2016

May 26, 2016

Apr 18, 2016

Mar 24, 2016

Looking for more? Browse all our products here