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Low
prices, high production costs and Mother Nature are just a few of the
challenges cotton farmers face today. To offset these risky elements,
farmers are looking for ways to manage their finances. For example,
they now have the option of selling their government Production
Flexibility Contract (PFC) and Conservation Reserve Program (CRP)
payments for a lump sum of cash.
Depending on farm size, these payments can
represent a substantial amount of money each year, assuming the
programs are not reduced or even discontinued before their maturity
dates.
Instead of having the money trickle in over the
next few years, it may be more advantageous to take one large sum for
the present value of these payments. Access to cash can provide more
financial flexibility.
Who Buys The Payments?
Heartland Capital Funding Inc., underwritten by Metropolitan Mortgage,
purchases government farm payments, structured settlements, lotteries,
attorney fees, commercial business notes and seller-financed mortgages.
If a farmer receives at least $7,500 per year in PFC payments or $4,000
in CRP payments, the farmer can assign a portion of the minimum amount
of the estimated payment range to Heartland in exchange for cash.
"This is not a loan, and all assignment documents
have been approved by the USDA," says Suzanne Wallskog, funding manager
of Heartland Capital Funding. "For a free, present value quote, farmers
can call or fax Heartland the low amount of the estimated payment range
stated on their Production Flexibility Contract form CCC-478B or CRP
for CRP-1. After receiving this information, Heartland will prepare a
written offer that same day or the next day at the latest. If the
farmer accepts, the Farm Service Agency will be contacted and the
farmer will receive a check within one month after the PFC payment
reassignment is acknowledged.
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