Bipartisan legislation recently reintroduced in the U.S. Senate would provide financial institutions with greater flexibility to offer affordable lines of credit to rural and agricultural borrowers.
The Access to Credit for our Rural Economy (ACRE) Act would amend the Internal Revenue Code to give farm real estate borrowers and rural homeowners the same tax-exempt status on certain earned interest that applies to other lenders.
The act would apply to agricultural real estate and single-family home mortgage loans of less than $750,000 in communities of fewer than 2,500 residents.
If the bill becomes law, it would expand access to affordable agricultural and home loans to more than 4,000 rural communities nationwide, according to estimates, and save family farmers and producers more than $400 million in annual interest expenses.
U.S. Sens. Kevin Cramer (R-ND), Ruben Gallego (D-AZ), Angus King (I-ME), Roger Marshall M.D. (R-KS), Jerry Moran (R-KS), and Tommy Tuberville (R-AL) introduced the bill.
“Rural communities across America are facing a serious affordable housing crisis. It has simply gotten way too hard to find reasonably priced homes in our small towns,” King said. “The ACRE Act is a commonsense way to make home and farm ownership possible for more families by providing better access to low interest loans.”
The bill has the endorsement of the American Bankers Association and the Independent Community Bankers of America.