Consolidated Farm Service Agency

This fact sheet provides information on the Agriculture Department's direct and guaranteed farm loan programs. In particular, GAO discusses (1) levels of outstanding debt on active loans and amounts owed by delinquent borrowers as of March 31, 1995; (2) losses on farm loans from fiscal year 1989 through March 31, 1995; and (3) new loans to borrowers who are delinquent and to borrowers whose past defaults resulted in losses.

GAO found that: (1) as of March 31, 1995, the Consolidated Farm Service Agency's (CFSA) outstanding principal for active farm loans totalled $11.9 billion in the direct loan program and $5.9 billion in the guaranteed loan program; (2) 47 percent of the outstanding principal in the direct loan program and 4 percent of the outstanding principal in the guaranteed program was held by delinquent borrowers; (3) farm ownership loans accounted for $4.7 billion in outstanding principal owed and emergency disaster assistance loans accounted for $3.2 billion in outstanding principal; (4) 34 percent of borrowers who owed less than $200,000 were delinquent, while 93 percent of borrowers who owed over $1 million were delinquent; (5) CFSA incurred $12.4 billion in losses on direct loans and $300 million in losses on guaranteed loans from FY 1989 through March 31, 1995; (6) the highest losses within the direct loan program occurred with emergency disaster assistance loans; (7) CFSA made about $234 million in new direct loans and $214 million in new guaranteed loans to borrowers after it had incurred losses on their previous farm loans; and (8) CFSA made an additional $130 million in loans from FY 1989 to March 31, 1995 under a policy allowing delinquent borrowers to obtain new loans for operating expenses.