plication for a loan and decides wheth- 

 er or not it will be made. 



The responsibility for making sound 

 loans lies with the associations. This 

 is where it should be, not only for 

 the sake of giving farmers friendly and 

 prompt service, but to keep down 

 losses. The forethought of the farmers 

 of the Farm Credit Act of 1933 under 

 which the production credit associa- 

 tions are organized, is borne out by 

 the progress made and the few losses 

 sustained. 



A great improvement has been made 

 in the promptness with which a farmer 

 can get his loan. No matter how far 

 he lives from the association offices, 

 there is a representative near him, for 

 there are 138 in Illinois' 102 counties, 

 not counting the central office of the 

 associations. 



When Mr. Farmer decides to make 

 application for a loan he has only to go 

 to the production credit association 

 office serving his county, shown on the 

 accompanying map, or to that associa- 

 tion's nearest representative. During 

 the past year many of the field offices 

 have been given the authority to dis- 

 burse loans and receive payment on 

 them in addition to handling the appli- 

 cation, inspection and recording. The 

 association inspects the collateral offer- 

 ed as security, the loan committee de- 

 cides if a loan can be made and if 

 approved the association is ready to 

 disperse the loan. In some instances 

 farmers have received their loan the 

 same day as they applied, although two 

 days or longer are usually required. 



Mr. Farmer may be a cattle feeder 

 and want his line of credit established 

 in advance of the time he actually 

 needs the cash so he can buy when he 

 finds the lot of cattle he wants at the 

 price he is willing to pay. The associa- 

 tions letter of credit enables him to 

 shop around and still not have to pay 

 interest on his loan until the cattle are 

 purchased and the letter of credit used. 



Loans are made to mature when 

 the products out of which they are to 

 be repaid are expected to be ready for 

 market, and nwy run for as long as 

 12 months. 



The production credit associations 

 have developed the budget type loan 

 to help farmers put to work the money 

 they have borrowed so that it will earn 

 every cent of interest they pay. An 

 example will serve to illustrate how 

 the budget type loan works. In this 

 case Mr. Farmer borrowed $2,400. He 

 received the various installments when 

 he had use for them and repaid them 

 as follows: 



The total interest charges at the cur- 

 rent 5 per cent rate were 547.11, where- 

 as if he had borrowed the entire $2,400 

 for 10 months, the interest would have 



totaled $100. He, therefore, saved 

 $52.89. The association made cash 

 available to him each time he needed it 

 as provided in the budget arranged at 

 the time the loan was made. His credit 

 needs were filled as adequately as 

 though he had borrowed the whole 

 $2,400 for 10 months. 



The close working relationship be- 

 tween the production credit associa- 

 tions and the Farm Bureau is indicated 

 by the fact that several of them have 



either their central or field offices in 

 the same building as the Farm Bureau. 

 The central offices at Ottawa and 

 Woodstock are examples. 



Probably the most valuable feature 

 of production credit to Illinois farmers 

 is its adaption to the particular needs 

 of the operation for which the money 

 is borrowed. Terms are so flexible that 

 with one operation the farmer finances 

 his beef cattle from pasture to market, 

 or his crop from planting to market. 



9^ 



CORN HAN 



The AAA com plan can give us stability 

 and price protection through — 



ADJUST3IE3rT of acreage to 

 head off ruinous surpluses and con- 

 serve our soil. 



LOAI\S to put a bottom under 

 prices and help us hold com on 

 the farm for use in lean years. 



QUOTAS for marketing and stor- 

 age, if needed to back up the loans 

 and if we approve. 



10 



L A. A. RECORD 



