The Federal Agricultural Mortgage Corporation, a federally chartered company that buys and guarantees farm and rural loans from lenders so they can make more of them.
Farmer Mac does for farm mortgages roughly what Fannie Mae and Freddie Mac do for home and apartment loans. The Farm Credit Administration, which regulates it, says Farmer Mac was created in 1988 to provide a secondary market for agricultural real estate mortgage loans, rural housing loans and rural cooperative loans. It is owned by stockholders and chartered by the federal government.
Its main activities, in the regulator’s list, are buying eligible loans from lenders, financing lenders by buying obligations secured by eligible loans, guaranteeing securities backed by pools of those loans, and issuing long-term standby commitments to buy loans. Eligible loans include mortgages secured by first liens on agricultural real estate and farm and rural development loans that USDA guarantees.
A borrower never deals with Farmer Mac. The effect shows up in the offer from a local lender. A community bank that could not hold a long fixed-rate farm mortgage on its own books may offer one because it can sell the loan. If a long fixed rate matters to you, ask the lender whether it sells loans to Farmer Mac.
How it shows up in the data here
Farmer Mac does not lend to farmers directly and is not a lender record on this site. A loan a bank sells to Farmer Mac leaves that bank's farmland balance, so a bank that sells most of its farm mortgages can look smaller in the farmland books ranking than its lending really is. Use farm lenders as the starting list and ask each lender whether it sells farm loans.
Go further
- Farm lenders by state: Banks and credit unions holding farmland loans.
- Methodology: Why balances held are not the same as loans made.
- Farm loan package checklist: A farm lender reads a balance sheet, a production record and a cash flow budget. The land is the collateral. The crop or the herd is the repayment, and it comes in once or twice a year.
- How to read a bank call report as a loan searcher: Every bank files a call report each quarter. One schedule in it lists the bank's loans by kind. Read that schedule and you know what the bank holds. You still do not know what it made last quarter.
Related terms
- Farmland loan: A loan secured by farm or ranch land and its improvements, usually made to buy or refinance the land and repaid over many years from farm income.
- Farm Credit association: A borrower-owned cooperative lender in the Farm Credit System that makes loans to farmers, ranchers and other eligible rural borrowers.
- FSA guaranteed loan: A farm loan made and serviced by a bank, credit union or Farm Credit lender, on which the USDA Farm Service Agency covers most of the lender's loss if the borrower defaults.
- Loan sale: A lender's transfer of all or part of a loan to another party, so that the buyer, not the lender that made the loan, holds that share of it.
- Agency lender: A lender authorized to make apartment loans that Fannie Mae or Freddie Mac then buys or backs, under those companies' rules instead of the lender's own.
- Portfolio lender: A portfolio lender is a lender that keeps the loans it makes on its own books instead of selling them to an investor.
Sources
Plain definitions for orientation, not legal, tax or credit advice. A lender's own policy decides what it will do.