What Farmers Need to Know About USDA Suspending Farm Loan Debt Collections
Debt Relief 012921
COVID-19’s ripple effect has again hit the farming community. This time, USDA responded by announcing a temporary suspension of past-due debt collections and foreclosures for borrowers under the Farm Storage Facility Loan and the Direct Farm Loan programs administered by FSA.
This move suspends non-judicial foreclosures, debt offsets or wage garnishments and referring foreclosures to the Department of Justice. In addition, USDA is working with the U.S. Attorney’s Office to stop judicial foreclosures and evictions on accounts previously referred to the Department of Justice.
USDA also extended deadlines for borrowers to respond to loan services actions such as loan deferral consideration for financially distressed and delinquent borrowers. And for the Guaranteed Loan program, lenders have flexibilities available to assist their loan customers.
With this announcement, 10% of borrowers – or 12,000 people – are eligible for relief.
“Not only is USDA suspending the pipeline of adverse actions that can lead to foreclosure and debt collection, we are also working with the Department of Justice and Treasury to suspend any actions already referred to the applicable agency,” said Robert Bonnie, deputy chief of staff, Office of the Secretary in a recent news release.
“Additionally, we are evaluating ways to improve and address farm-related debt with the intent to keep farmers on their farms earning living expenses, providing for emergency needs and maintaining cash flow,” he continued.
The suspension is in place until further notice and is expected to continue while the nation-wide COVID-19 disaster declaration is in place.
“USDA and the Biden Administration are committed to bringing relief and support to farmers, ranchers and producers of all background and financial status, including by ensuring producers have access to temporary debt relief,” Bonnie said.