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Two facts on the mortgage situation need to be emphasized. In the first place, the majority of outstanding mortgages are first mortgages held by lending institutions with obligations to meet in the future that are based on these mortgages. In the second place, foreclosures are not a· new development. For the last 12 years in Iowa a steady liquidation has taken place. Yet 1 billion dollars of farm mortgages are still outstanding.

What can be done? Without question every lender and borrower should be familiar with the recent Mortgage Moratorium Act, a copy of which is included in the Appendix. In addition, what is needed is the cooperative study and action of both debtors and creditors on income-raising proposals. Agitation between debtors and creditors by itself will not correct the maladjustment. Both parties, lenders as well as borrowers, are suffering from the same trouble, low farm income.

This circular has been divided into two parts, the first dealing with foreclosure data, particularly as they relate to the period 1921-32, and the second with proposed solutions. The authors are indebted to the staff of the Agricultural Economics Department for help in the preparation of this report.

This publication is the ninth in the series on the agricultural emergency in Iowa. The next circular will deal with alternative foreign trade policies.



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