On Thursday, the U.S. Department of Agriculture (USDA) announced that it is suspending all debt collections and foreclosures on farm loans because of the need for relief from the COVID-19 pandemic. The suspension applies to farmers who borrowed funds under the Farm Storage Facility Loan and the Direct Farm Loan programs. The relief will apply to over 12,000 borrowers, which is about 10 percent of all farmer, rancher, and producer borrowers.
All non-judicial foreclosures are temporarily suspended and, according to the press release, the USDA will work with the U.S. Attorney’s Office to stop judicial foreclosures. The department also extended deadlines to respond to loan deferrals and allow more flexibility for lenders under the Guaranteed Loan Program.
“USDA and the Biden Administration are committed to bringing relief and support to farmers, ranchers and producers of all backgrounds and financial status, including by ensuring producers have access to temporary debt relief,” said Robert Bonnie, Deputy Chief of Staff, Office of the Secretary in the USDA press 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.”
This relief is expected to last as long as the national COVID-19 disaster declaration is still in effect. The applicable loans help farmers purchase or improve their farms, purchase livestock and equipment, construct cold or dry storage, and operate farms.
This action follows the USDA suspending all payments under the Coronavirus Food Assistance Program (CFAP). The payments were suspended after a White House memorandum began a regulatory freeze for President Joe Biden’s incoming administration to review the aid. Applications for aid will continue to be accepted during the evaluation, until the deadline on February 26. The CFAP website explained, “in the coming days, USDA and the Biden Administration intend to take additional steps to bring relief and support to all parts of food and agriculture.”
Successful Farming reported on Thursday that this assistance that has been frozen consists of almost one-quarter of the money sent to agriculture from the December COVID-19 aid bill. “We’ve essentially paused implementation until the review is complete,” USDA spokesman Matt Herrick said to Successful Farming. “Applications can continue to come in even while the program is on pause. This is a big, big program, and we need to get it right.”
