An analysis of Production Credit Association borrowers in Middle Tennessee

The objectives of this study were: 1. To compare the farm and borrower characteristics for AB and C loan groups. Farm characteristics to be considered included type of enterprises and size of operation. Characteristics of the borrower to be considered included an analysis of age, tenure status, type of operator, participation in credit life insurance program, number of children, years farming, and the number of years residing on the present farm. 2. To compare factors which influence risk bearing ability of AB borrowers and C borrowers, such as: loan purpose, amount of loan, type of security, amount of security, financial condition, and other sources of credit. 3. To examine the C borrowers over a period of time with emphasis on the capital growth and changing risk status of this group of loans. In essence the first two objectives were concerned with patterns and/or characteristics common to C borrowers as compared to AB borrowers. Objective three was concerned only with C borrowers with no comparison to AB borrowers. No comparison was made due to the assumption that AB borrowers are "typical," i.e., make capital progress; whereas a "grey" area exists concerning the progress and/or what happens to C borrowers. Authorities within the field indicate a lack of agreement concerning the role of C loans in farm lending.