In the face of escalating economic pressures, U.S. farmers and ranchers are grappling with a perfect storm of tariffs, soaring input costs, and financial distress. As these challenges mount, understanding borrower rights and distress loan servicing options within the Farm Credit System has become increasingly crucial. This is why the upcoming webinar hosted by the National Agricultural Law Center (NALC) is a must-attend event for anyone involved in the agricultural industry.
From 2023 to 2024, Chapter 12 bankruptcies for U.S. farms surged by 55 percent, highlighting the severe financial strain many producers are under. Chapter 12 bankruptcy allows family farmers and fishermen to restructure debts, providing a lifeline to avoid asset liquidation. This stark increase in bankruptcies underscores the urgent need for farmers and ranchers to be well-informed about their financial options.
The Farm Credit System, established in 1916, plays a pivotal role in providing credit and financial services to rural communities and agriculture. As of June 30, 2024, the system held $421 billion in outstanding debt, marking a 6 percent increase over the previous year. This growth reflects the system’s expanding role in supporting the agricultural sector during trying times.
On April 16, the NALC will host a webinar titled “Distressed Loan Servicing and Borrower Rights in the Farm Credit System.” Led by Bob Mikell, executive vice president and general counsel at AgSouth Farm Credit, the webinar will delve into the intricacies of borrower rights within the Farm Credit System. Topics will include loan restructuring, credit review hearings, and the right of first refusal, among others.
Mikell emphasizes the importance of understanding these processes, especially during periods of financial difficulty. “Producers and those who work with them need to understand the distress loan process when dealing with Farm Credit System institutions,” he said. “Knowing restructuring options and borrower rights can make a significant difference when navigating current financial conditions.”
The webinar is scheduled for 11 a.m. Central/Noon Eastern and is open to the public at no cost. Registration is available online at nationalaglawcenter.org/webinars/distressed-loan-servicing. This event offers a valuable opportunity for farmers, ranchers, and industry professionals to gain insights into managing financial distress and protecting their rights within the Farm Credit System.
As the agricultural industry continues to face economic headwinds, staying informed and proactive is essential. The NALC’s webinar provides a timely and relevant platform for learning about the tools and rights available to borrowers within the Farm Credit System. By participating, attendees can better equip themselves to navigate the challenges ahead and secure a more stable financial future.