Recent news stories about more than 83,000 American farmers being sent foreclosure notices are erroneous and misleading, says the director of Utah's Farmers Home Administration.
Lee Hawkes told the Deseret News his office will begin sending out notices Tuesday to 189 farmers whose loans are more than six months delinquent - out of 1,241 farmers who have FmHA loans.Hawkes said these 189 owe nearly $20.7 million in delinquent payments. The principle balance on their loans totals $50 million, he said. The Reagan administration says delinquent farmers throughout the nation owe more than $8 billion in delinquent payments.
"These are just notices. We aren't foreclosing on anybody. I'm afraid earlier reports made it seem as if the government is going to take the farms away from 90,000 American farmers - and that simply is not the case."
Hawkes said the U.S. government doesn't want to be in the farm business and doesn't want to take over anybody's farm.
"We want to help delinquent farmers straighten out their financial affairs. We want to help them solve their money problems and stay on the farm," he said.
"Because of a class-action suit and a court injunction, the FmHA has not been able to send out foreclosure notices to farmers for the past four years. We are glad now that we can start a program to recover whatever we can of taxpayers' money from farmers, but the program also wants to keep as many farmers on the land as possible."
Hawkes said all 189 of the delinquent Utah farmers have been delinquent for more than 1 year; 42 have been delinquent two years and 46 have been delinquent more than 2 years.
He said the new program to collect money from delinquent farmers is broad in scope and has been in the planning stages a year. "The notices ask farmers to come into our office so we can talk to them about their future plans. We discuss how they expect to pay off their loan and their farming plans for the next year or two.
"We can offer them a lot of help. We study each farmer's situation in detail. Then we decide if we should re-amortize their loan, reschedule it, defer it or lower the interest rate from 9 to 11 percent down to as low as 4.5 percent."
Hawkes said the FmHA, if it believes a farmer just can't make it, even with these kinds of funding aids, can write down or reduce the farmer's debt to a level he can cope with.
"We want to keep farmers in business," he said.
If even reducing a loan won't help and if a farmer's future is hopeless, Hawkes said, the FmHA can foreclose and sell the farm, but not until it has reduced the amount owed to the amount that would be realized from the sale of the farm.
"We don't want to put a farmer out of business and then still have to worry about owing us a large amount of money."
Hawkes said farmers who actually must go through foreclosure can still keep their home and 10 acres of adjacent land.
"We have a program to sell back to the farmer his home and 10 acres, at the current market value, so he is not actually forced off his land."
FmHA officials said farmers have 45 days to respond to the foreclosure notices and indicate whether they intend to pay their debts or take advantage of the restructuring opportunities. Those not responding to the warning forfeit the right to ease their repayment terms and trigger procedures for foreclosure.