The Federal Agricultural Mortgage Corporation, also known as Farmer Mac, is a stockholder-owned, federally chartered corporation established by the U.S. Congress in 1988 under the Agricultural Credit Act of 1987. It was created to establish a secondary market for agricultural real estate and housing mortgage loans, to increase liquidity and the availability of long-term, stable credit for farmers, ranchers, and rural communities.

Farmer Mac operates by purchasing eligible loans from agricultural and rural infrastructure lenders, guaranteeing securities backed by those loans, and providing loan funding and risk management solutions to rural financing institutions.

Farmer Mac supports a wide range of markets, including agriculture, agribusiness, rural broadband, power and utilities, and infrastructure financing, with the aim of enhancing the availability of long-term credit and providing greater liquidity and lending capacity for lenders to agriculture and infrastructure borrowers.

2008 financial crisis

In June 2008, during the 2008 financial crisis, Farmer Mac had $47.2 million invested in Fannie Mae shares. Over the next few months, during the Federal takeover of Fannie Mae and Freddie Mac, these investments lost about $44 million in value. The company also had significant investments in Lehman Brothers. In response, the Farm Credit System bailed the company out by purchasing $60 million in Farmer Mac stock, and Zions Bancorporation of Salt Lake City purchased another $5 million in stock.

See also

  • Fannie Mae
  • Farm Credit System
  • Freddie Mac
  • Ginnie Mae
  • Sallie Mae

References

  • Farmer Mac home page