A bill that would make it easier for farmers and rural families to access real estate credit is a bipartisan solution that will help sustain and grow rural America, the American Bankers Association said Thursday in a letter to Senate leaders.
Farmers and ranchers are facing skyrocketing costs on everything from fertilizer to pallets, and rising interest rates are making it more difficult to purchase agricultural land and finance existing operations, ABA said. The Access to Credit for our Rural Economy, or ACRE, Act introduced by Sens. Jerry Moran (R-Kan.) and Angus King (I-Maine) would exclude from gross income the interest received by a qualified lender on all loans secured by farm real estate and aquaculture facilities. It also would exclude the interest received by a qualified lender on home mortgage loans that do not exceed $750,000 in rural communities of no more than 2,500 people.
“In an intensely competitive lending market, these tax savings would be passed along to borrowers in the form of lower interest rates on loans secured by farm real estate and aquaculture facilities, saving farmers and ranchers approximately $950 million per year,” ABA said, noting that the ACRE Act puts homeownership back within reach and stems population loss in rural communities by lowering the interest rate on qualified mortgages by an estimated 0.5% to 1.5%. “Finding bipartisan solutions to reduce interest rates in this environment is extremely important to American agriculture and rural America,” ABA said.
