UNITED STATES DEPARTMENT OF AGRICULTURE 



BULLETIN No. 1048 



Contribution from the Office of Farm Management 



and Farm Economics 



G. W. FOESTEK, Acting Chief 



jl\J^''^^U 



Washington, D. C. 



W 



February 7, 1922 



BANK LOANS TO FARMERS ON PERSONAL AND 

 COLLATERAL SECURITY. 



By V. N. Valgren, Associate Agricultural Economist, and Elmek E. Enqelbert, 

 Junior Economist in Farm Finance. 



CONTENTS. 



• Page. 



Amount of personal and collateral bank 

 loans to farmers 2 



The estimated amount of personal and col- 

 lateral loans to farmers 3 



Seasonal fluctuation in personal and collateral 

 loans to farmers 4 



Rates of interest 6 



Page. 

 Minimum balance requirements against bank 

 loans to farmers on personal and collateral 



security 17 



Interest coUeetions in advance 20 



Nature of security for farmers' personal and 



collateral loans 20 



Term of loan 22 



Conclusion 25 



A very large part of the world's business is conducted on a credit 

 basis. In proportion to the magnitude of the industry, it is perhaps 

 safe to say that a smaller amount of credit is used by farmers than 

 by any other important class. The outstanding loans to farmers in 

 the United States, nevertheless, amount to a significant part of the 

 credit of the country. The present farm mortgage credit from such 

 data as are available has been estimated at a sum exceeding 8 billions 

 of dollars. The information available on personal and collateral 

 credit to farmers is even less satisfactory than that concerning farm 

 mortgage credit. No attempt will be made at this time to present 

 an estimate of the total amount of such credit. 



By far the most important single source of personal and collateral 

 credit to farmers, as well as to most other industries, is found in the 

 commercial banks of the country. With a view to obtaining more 

 comprehensive information concerning this source of rural credit, 

 the Department of Agriculture recently sent to all banks in the 

 United States a questionnaire on loans to farmers. The results of 

 this inquiry, so far as it relates to short-time or personal and col- 

 lateral credit, is summarized on the succeeding pages. 



79293°— 22— Bull. 1048 1 



