The American Bankers Association and Federal Agricultural Mortgage Corp. have entered into an agreement to bring ABA members pricing discounts, easier access and new opportunities in the secondary market for farm real estate loans.
Under the agreement, ABA member banks will enjoy special pricing discounts on selected Farmer Mac products and new AgPower customized loan-packaging services. ABA members will also benefit from a streamlined process through which they may access Farmer Mac.
“With this agreement, our members will have better access to Farmer Mac and the benefits that the secondary market for agricultural mortgages can bring to their customers,” said Edward Yingling, ABA president and CEO. “This is especially important for farmers and ranchers who are concerned with rising interest rates and want to manage interest rate risk by locking in long-term fixed rates for their farm mortgages.”
“Farmer Mac is extremely pleased to be helping ABA member banks expand their farm lending capabilities and increase the value they bring their customers,” said Henry Edelman, Farmer Mac president and CEO. “We look to this alliance to help us serve an even larger segment of the banking industry. By making it easier to access Farmer Mac, more lenders will have the ability to use our products and pass on the benefits to their farm borrowers.”
Participating ABA members participate in the alliance can choose from the following:
-- Competitively priced, long-term, fixed rate farm loans, up to 20 years;
-- Adjustable-rate mortgages (ARMs), including those with reset periods of one, three and five years;
-- Long-term fixed rates featuring both open and partial open prepayment options.
“The Farmer Mac/ABA Alliance allows us to offer a new set of options to our farm and ranch customers,” said Jeff Wolfgram, vice president, First Dakota National Bank, a community bank in Yankton, S.D. and a member of the ABA Agricultural and Rural Bankers Committee. “It’s a good feeling when you can sit down with farm borrowers and discuss a whole range of product choices, including fixed rates of 10, 15 and 20 years.”