, 2.' fiUoW UNITED STATES DEPARTMBBT OT AO&ICULTUUI Bureau of Agricultural Bconosd.es Washington 25, D. 0. July 19*4*4 TARH-MOBTOAOS DEBT BJEDUCBD 952 MILLIOH DOLLARS, 19*40-*4*4 Total farm-mortgage debt outstanding on January 1, 19*4*4 is estimated at $5, 63I+, 772, 000, which is a reduction of $952,000,000 from the total out- standing k years earlier. Almost $250,000,000 of this reduction occurred in 19*42 and 19*43. The reduction of 13 percent in these 2 years of greatly increased farm income compares with redactions of 15 percent in the period 1932-33 and 8 percent in 1923-2*+ when debt liquidation was greatly accel- erated "by foreclosures and related distress transfers of mortgaged farms. On January 1, 19**** the farm-mortgage debt was almost 6 percent "below that for a year earlier, 1*4. *4 percent "below the total for January 1, 19*40, and almost *48 percent "below the peak- year total for 1923. At the "beginning of 1918, roughly *4 years after the outbreak of World War I, mortgage debt was $6,536,860,000, or almost one-sixth larger than at the beginning of 19*4*4. PERCENTAGE CHANGE IN OUTSTANDING FARM-MORTGAGE DEBT, JAN. 1, 1940-JAN. 1, 1944 UNITED STATES -14.4 PERCENT U. S. DEPARTMENT OF AGRICULTURE. NEG 43768 BUREAU OF AGRICULTURAL ECONOMICS ^ UNIV. OF PL LIB , DOCUMFNT.q nFF DEPT 3 DEPOSITORY Figure I -2.- Table 1.- Istloated fara-aortgage dabt, by States, for January 1, 19*4, for selected years of World War I and World War II, and for the peak year 1923 State and dlrlilon Maine lev Hampshire . . . Vermont Maetachusetti . . ■ ■node Ialand . . . Connecticut .... lew Ingland . . . la* York lew Jersey .... Pennsylvania . . . Middle Atlantic . Ohio Indiana Illlnolt Michigan Wisconsin last Borth Central Minnesota Iowa Missouri North Dakota . . . South Dakota . . . ■ebraska . . . ... Kansas West Dorth Central Delaware ..... Maryland if .... . Virginia West Virginia . . . Worth Carolina . • . South Carolina . . , Georgia . Florida South Atlantic . , Kentucky Tennessee Alabama Mississippi last South Central Arkansas Louisiana Oklahoma Texas West South Central Montana Idaho Wyoalng Colorado Hew Mexico Arliona Utah Nevada Mountain Washington Oregon California Pacific UIITID STATXS . . . . /are-mortgage debt 19 Uo 1.000 dollars 2^.757 11,220 27,81* 45,845 4,121 36.7*2 150, *99 191.786 48,791 1 )1 . 578 37Z . i» 239,059 236,266 Uig.970 17U.308 ' 23L 35 6 . ^25? 5JS2. 375.990 705.589 229.377 11*1,230 127.706 309,826 28*. 248 2.173.96b 7.957 U6.675 72.299 21.969 90,071 1*5,9*6 82,037 38,101 1*05.057 109.253 92,6l4 81,859 100 , 368 38U.09U 72.513 55.098 153.679 JUi 713I036 66,118 78.763 34,009 75.005 ?7.*99 28.933 36.650 10.213 357,190. 106,857 90,U2i y>7.585 6QU.863 6,586,399 191*3 1,000 dollars 20,081 11.505 27.231* *3.*75 3.800 32-998 1W-M* 168.271 l*8,5UO 125.701 3*2.512 2*2, 686 229.129 373.981 161,231 1 .320,9 385.623 710,985 219,962 122,631 114,740 261,753 227,800 3,01*3,1*91* 8.3*7 1*3, 3gi* 68,1*06 20.193 88,61*5 *5.950 89.916 33.726 398 .567 108.687 77.036 88.053 99.968 373,7** 78,1*05 57.029 151. 55 1 * 386.271 '73 ,2 59 1*8.11*3 70,790 25,621* 61,386 2U.195 26.362 27.977 8,20* 292,681 92,061* gU.235 ^6,559 532,85 8 6,117.168 19UU 1,000 dollars 17.15? 11,39U 28,911 U3.677 3.693 32,1 91 H7.025 156,651 U5.863 123 , i*!*3 325.957 231 , 1*1*6 203,169 325.915 150,1*63 28 7,5 1 1.198.506 364,768 652,906 207.327 105.0U7 105,01*2 232,921 195,139 1. 863.150 8.095 1*2,894 65.124 17.986 80,829 1*2,932 85,740 33,30,* aft 904 102,915 70.06? 80,35U 90.3 8 9 3*3.727 Percentage | change Pars- sort gage debt 1943.44 19UO-UU Percent -1*.6 - 1.0 6.2 •5 - 2.8 - 2.1* - 1-5 6-9 5-5 1.8 XT 77.519 54,132 11*1.850 31*5.61*2 619 . 1*3 39.876 62.619 22. 37* 5U.238 2*. 880 2U.981 22.713 7.071 258 ,75 2 83,028 ""SB JUL, 511,5? 2/5. 63*. 772 - l*.6 -11.3 -12.9 - 6.7 • 8.U - 9-3 - 5-* - 8.2 - 5-7 .1U.3 - 8.5 -11.0 8.8 - 3-0 - 1.1 - U.g -10.9 - 8.8 - 6.6 - U.6 ■ 1.3 ^i 5-3 9.0 8.7 _9^6 - 8.0 1.1 5-1 6.U -10.5 Percent -17.2 -11.5 -12.7 -11.6 2.8 - 5-2 -18.8 -11.6 9-8 3-7 2.6 TTJ 7-9 -30.7 1.6 ■ J:? -10.1* -12.1* -9-Q -18. 3 - 6.0 ■ 6.2 -12. U - 3.2 -1U.0 -22.2 -13-7 -19.1* -1 5-9 - 3.0 - 7-5 -9-6 -25.6 -17.7 -2U.8 JiJ. 1.7 - 8.1 - 9-9 -18.1 -10.3 - 6.6 -12.6 7-0 - 5.8 -21*. 3 - 1.8 _2JL -10.5 6.9 1.8 7-7 12*2. -39-7 -20.5 -3U.2 -27.7 - 9-5 -13-7 -38.0 -30.8 -22.3 -10.2 -lU.S - 8.0 I -13.2 I 2HZ -14.4 1911* 1,000 dollars 1U.568 6.481 17.828 26.566 2.768 22.3U6 91,057 17U.281+ 1*6. U32 116, 8Ul 3 37 ,5 57 144,22* 1*6,7*0 338.369 156,711 297, *?? 1.083.543 261.315 659,801 268.03* 160, 642 151.563 195.630 1 7 3.5 77 1.870.562 7.951 1*0.906 30.897 9.737 22.367 23.363 37.316 12 .2 7^ 18U, 816 39.^13 33,860 31.786 1*0.608 1* 5 ,66 7 3U.38U 30,30g 107.^87 276,064 448.243 60,188 35.*77 13.985 *5.333 IO.0U9 12.377 10,1*71 3-949 191.829 82.356 51. 308 220,1*20 354.081* «. 707, 358 1918 1,000 dollars 19.125 8,082 25.133 30,225 2.730 24 110 109.405 197. 647 25.728 118. 106 3*1- *81 189.1*21 179 . ^fi Ul3,22U 207,232 409,372 1 ,398,655 1*16,556 986.643 352.791 219.365 230.259 318.5*5 26 9,672 2-793.831 7.789 37.386 44.109 8.820 36,922 31.050 53.053 11.890 231,019 61,488 5M51 28.5«3 "2,525 187 , 247 50.737 31.31* 180,237 335,8*6 598.131* 118,226 75.687 22.759 86,617 lg.401 21.387 22,151* 9.770 375 .001 9*. 755 69.052 338, ?gQ 502.087 6.536.860 1923 1.000 dollars 27.950 9.320 31.537 34,283 2.583 .6.1*56. A 1^,129 242,511 1*8,671 172.200 *63.382 271.081 293.448 705,61*4 251,66U 569.846 2.091.683 606.134 1.535.9*3 511.571 12.870 1,281 691; 732 27J2L 5 *■ 636,928 9.564 62,21*7 83.37* 26,322 81.386 98,151* 139.878 29.532 5 30. *5 7 "5.793 83,091 67.569 139 .9*2 406.395 117.784 57.35* 28*. 766 1,015 .786 192,092 158.737 59.51* 203,061* 32.297 48,7*8 52.095 25.053 771.600 152,920 133.368 1. Q69 8 727 ,357 10,785,621 Percentage change 191*-lg Percent 31.3 2*. 7 41.0 13. g - 1.4 _5si 20.2 1.1 1.2 31.3 22.3 22.1 32.2 JUL _22A 59-* 49.5 31.6 36.6 51.9 62.8 34 - 2.0 - g.6 *2.g - 9-* 65.I 32-9 U2.2 25-0 56.0 61. 4 -10.1 *-7 28-5 1(7.6 3-3 67-7 JUJ_ JL1 96.* 113.3 62.7 91.1 83.1 72.8 111.6 1*7.4 95-5 X r4 34. b _5ii 41. S 38-9 1918-23 Percent 1*6.1 15.3 ?5.5 13.4 - 5-* JL2 29-9 22.7 89.2 *5.8 ■ 35-7 *3-i 63.6 70.8 21.1* 32^2 4o^_ *5.5 55-7 1*5. 42.6 96.0 117.2 95.6 22. g 66.5 gg.o 198. U 120.4 216.1 I63.7 148.4 129-6 88.3 52.0 136.* 229.1 117-0 132.1 83.2 58.0 65-5 69.8 62.5 109.7 161.5 134.U 75-5 127.9 135-1 156. 4 105. s bl.* 93-1 0.* * 65.0 1/ Includes District of Columbia. 2/ Includes loans called for foreclosure by the Federal lend banks and Federal Farm Mortgage Corporation of $8*, 38* that are not distributed by Statee. - 3 - Changes in farm-mortgage debt during the U years ended January 1, 19UU have varied widely by regions (fig. l)„ A decline occurred in all hut five States - Arkansas, Delaware, Georgia. New Hampshire, and Vermont. Re- ductions of more than 30 percent occurred in six States - Kansas, Maine, Montana, Nevada, Utah, and Wyoming. The largest percentage reduction for any geographic division was in the Mountain States (27. 6 percent), and the smallest was in the South Atlantic States (7-0 percent). During 19U3 mortgage debt decreased over $^80,000,000, a reduction of almost g percent as compared with 5.7 percent in 19^2 and less than 1 percent in each of the years 19^0 and 1941 . Percentage changes during 1943 range by States from moderate increases in three States - Massachu- setts, New Mexico, and Vermont - to substantial reductions in Montana and Utah of 17. 2 and 18.8 percent respectively (table l). By geographic divi- sions the percentage decrease ranges from 1»5 percent for the New England States to 11.6 percent for the Mountain States. Reductions of more than one-eighth occurred in eight States - Illinois, Kansas, Maine, Montana, Nevada, North Dakota, Utah, and Wyoming. Changes in mortgage holdings of principal lender groups ~ Changes in the farm-mortgage loans held by the several lender groups have varied sub- stantially from the over-all change in the mortgage debt (table 2). Out- standing federal land bank loans declined about 15 percent during 19^3 &• Table 2.- Farm-mortgage debt: Total outstanding amounts held by selected lending agen- cies . United States. January 1. 1940. 1943. and 1944 Amount outstanding January 1 Percentage change 1940-TI943- Percentage distribution Lender group 1940 1.000 1943 1,000 Federal land banks l/ Land Bank Commis- sioner 1/ ........ Joint stock land banks 2/ ..... Farm Security Admin- istration 3/ ..... Life insurance com- panies 4y ........ Insured commercial banks Others 5/ UNITED STATES dollars : dollars 2.OO9. 807 II. 718. 315 713.756 91 .726 38.566 984.290 534.170 2.214>084 6.586,399 543^884 37.015 I63.68I 1,042.939 476.676 2.134.658 6.117,168 1944 1.000 dollars 1452.933 429.721 10.087 176.595 986.661 448.433 2.130.342 5.634.772 AL AL Pet. -27.7 -39.8. -89.0 357.9 -16.1 ^8 -14.4 Pet. -15.4 •21.0 -72o7 7.9 - 5-4 - 5»9 - .2 - 7.9 1940 : 1943 : Pet. : Pet. 8 30.5 ! 28.1s 10.8 ; 8.9: 1.4 i .6! .6 2.75' 15.0 17.0: 8.1. 33-6; 7.8! 34.9: 100,0 100.0: 1944 100.0 1/ Includes regular loans . purchase -money mortgages, sales contracts, loans in sus- rse, and loans called for foreclosure. Includes joint stock land banks in liquidation and in receivership Includes tenant -purchase loans, fara-developaent loans, and farm-enlargement loans as well as real estate loans made from State Hural Rehabilitation Corporation trust funds. 4/ Based upon direct reports from life insurance companies, official reports to State insurance commissioners and Best's Life Insurance Reports. Includes regular loans, purchase-^ffloney mortgages, and sales contracts. 5J Includes loans made by individuals and other miscellaneous lenders. compared with a decline of about 8 percent for all mortgage debt. For the H-year period ended January 1„ Ijkk loans of the Federal land banks de- clined 27o7 percent as compared with a decline of lU.U percent for all farm- mortgage debt. Land Bank Commissioner loans decreased 21 percent in 19^3 and. 39.8 percent for the 4-year period ended January 1, 19W, On January 1 1944 life insurance companies held only a slightly larger volume of farm real estate loans than at the beginning of l9*+0» how- ever, the total declined 5 600,000,000 and the average size of mortgages recorded reached a peak of $l*„ 270. When comparing the absolute amount of farm-mortgage recordings in the two war periods, account must be taken of the longer average terms eg* mortgages recorded in recent years than in the World War I period. When the period of years for which loans are made is long, only a small propor- tion of the outstanding loans come due and must be paid off or refinanced each year. With a larger proportion of the loan contracts now providing for annual repayments, more of the debt liquidation takes the form of grad- ual reduction of loans rather than refinancing the amount that cannot be repaid at maturity. The ratio of mortgage debt to the value of all farm real estate rose from 11 „ 9 to 13.1 percent from 191U to 1918, whereas it declined sharply from 19 6 to 12 oU percent from 19U0 to 13kk A major part of the decline in the ratio after 19^0 is accounted for by the sharp rise in real estate values. Both mortgage debt and land values rose during 1918 and 1919. but with the fall of land values in the early 1920 °s and the continued rise of mortgage debt the ratio of mortgage debt to value reached 20 percent in 1923. The ratio continued at that level up into the early 1930°s. From a high point of almost 28 percent reached in 1933 * n e ratio declined to below 20 percent in 19U0 and has since fallen below the 1918 level In 1918 all of the southeastern States had debt-to-value ratios sub- stantially below the national average, whereas in 19^ Mississippi and Alabama were above the average and most of the other southeastern States had a higher ratio of debt to value than in 1918 (f ig„ 2) . Several of the Mountain States, however,, had much lower debt-to-value ratios in 19^ than in 1918. Two areas had relatively high debt- to- value ratios in both years. These are: (l) Iowa, Minnesota, North Dakota, and Wisconsin and (2) Hew York and a number of the New England States. > UNIVERSITY OF FLORIDA 3 1262 08921 5411 FARM-MORTGAGE DEBT AS A PERCENTAGE OF THE VALUE OF ALL FARMS, JANUARY 1, 1918 AND 1944 UNITED STATES VALUE 45.592,000,000 DOLLARS DEBT 5,634,772,000 DOLLARS* PERCENT 12.4 UNITED STATES VALUE 49,979,664,000 DOLLARS DEBT 6,536,860,000 DOLLARS PERCENT 13.1 £>]Under 9.5 9.5-11.4 PERCENT 111. 5-13.4 13.5-15.4 15.5 and over * INCLUDES LOANS CALLED FOR FORECLOSURE OF 84,000 DOLLARS NOT DISTRIBUTABLE BY STATES U.S. DEPARTMENT OF AGRICULTURE. NEG. 43769 BUREAU OF AGRICULTURAL ECONOMICS Figure 2