Pub. 13 2018-2019 Issue 3

WWW.NEBANKERS.ORG 24 Shedding Light on the Farm Credit System, America’s Least Known GSE © 2018 Bert Ely BERT ELY’S FARM CREDIT WATCH® O N AUG.1, FARMCREDIT MID-AMERICA (MIDAM), THE SECOND largest FCS association, announced at a PGA TOUR event that it was rebranding its consumer lending division. With $22.5 billion of assets, MidAm serves Ohio, Indiana, Kentucky and Tennessee. According to its news release, MidAm, “is improving its consumer lending division by launching the brand Rural 1st. Building on its existing experi - ence, the lending cooperative has streamlined processes, added new technology, and specialized a team of expert loan officers [sic] — all to make buying rural property as simple as possible.” Why MidAm needs a consumer lending division is an obvious question the news release did not address. The release also made no mention of the fact that MidAm is an FCS association — instead referring to itself as a “company” — that like other FCS institutions was created to provide credit to farmers and ranchers who cannot obtain credit elsewhere. The news release quoted Art Whaley, MidAm’s senior vice president for consumer lending, as stating that “our customer’s dream of rural living is the sole purpose of our business.” That certainly is not why Congress created the FCS. The release sum- marizes the “unique and specialized lending options, tailored specifically for rural land, home purchases and construction projects” offered by MidAm, including lot loans, recreational land loans, construction loans, home loans and home equity loans. What is interesting about the news release and MidAm's home loan page is what it does not state about the restrictions on rural home loans imposed by the Farm Credit Act and regu- lations under that act supposedly enforced by the Farm Credit Administration. Importantly, an FCS rural home loan can only finance a “single-family moderately priced dwelling located in a rural area that will be owned and occupied as the rural home- owner’s principal residence.” To its credit, the MidAm notes an LARGE FCS ASSOCIATION LAUNCHES CONSUMER LENDING BRAND