Frequently Asked Questions
Answered by your Directors.
Regarding disgruntled former borrower:
Yes, absolutely! All stockholders should rest assured that Alabama Farm Credit will uphold the security of your loan at all costs.
The Board and Senior Management of Alabama Farm Credit are charged with protecting the association from threats for the benefit of ALL shareholders. For this reason, Alabama Farm Credit is taking appropriate action to address this previous borrower’s baseless and inflammatory threats, as well as this previous borrower’s illegitimate efforts to take control of Alabama Farm Credit.
AFC only uses social media to relay vital information to our stockholders, not to engage in banter or threats.
No, there will be no official shareholder meeting on December 29, 2023. Any such gathering on December 29 would be of no official consequence to Alabama Farm Credit, because no shareholders meeting has been called for that date in accordance with the applicable provisions of AFC bylaws. Any attempt to call or hold any future shareholders meeting will likewise be of no official consequence to AFC absent compliance with the applicable provisions of AFC bylaws.
Poultry Loan FAQ’S
A borrower and the integrator agree to assignment of income documents at loan origination; all three parties (Alabama Farm Credit, borrower(s), and the integrator) sign the agreement. This agreed-upon amount is sent to Alabama Farm Credit from the integrator as each flock is sold.
Assignment amounts are an estimate created at loan origination or servicing based on what is known about the customer's operation. These estimates cannot account for all the variables: variability of flock out time, number of days birds are on the farm, grower performance, or number of flocks provided in a 365-day period.
As stated in the borrower contract, Alabama Farm Credit uses assignment money only to pay down the borrowers' loans. Every action we take as your poultry lender is supported by the loan agreements you have executed as a borrower.
Poultry assignments function to match up irregular income with scheduled loan payments. The assignment allows the borrower to apply a certain amount from each check towards their installments.
When an AFC customer wants a revised assignment or requests assignment proceeds be returned, and the customer has maintained a good payment history, Alabama Farm Credit reviews those requests.
Alabama Farm Credit no longer uses the old Funds Held process for managing assignment proceeds, because it costs the borrower more interest over the life of the loan. This change was communicated to all borrowers in 2021. This change is to the benefit of the borrowers, as the funds are automatically applied to the next installment that is due. This application of money towards the next installment reduces the amount of interest paid by the borrower over the course of the borrower’s loan repayment.
Alabama Farm Credit offers what we call LIFO (“Last-in, First-out”) RLOC to all borrowers paying their loans by an assignment. This line of credit is designed for when a borrower has a delay in income that will cause a small shortfall in the installment being made on time. Using the RLOC allows the borrower to avoid late fees or penalties. Customers must be in good standing to qualify for this loan product.
Cross-Collateralization and Foreclosures:
Cross-collateralization provides for the collateral a borrower pledges to secure any one loan from a lender also to secure all other loans made to the same borrower by that same lender. Cross-collateralization occurs only with the clear acknowledgment by the borrower that all loan agreements and collateral are interdependent and is customarily used by lenders to better secure all loans made to the same borrower. Cross-collateralization is an industry-standard practice embedded in most lenders' loan documents as standard language. Alabama Farm Credit’s responsibility to all shareholders is to ensure credits are structured soundly so as to avoid credit losses.
No. Annually, foreclosures represent 0.001% of the association’s portfolio. Foreclosures are always a last resort with Alabama Farm Credit and are used only after all other efforts have been exhausted.
Absolutely not. Per our standards of conduct neither Alabama Farm Credit’s employees, nor the employee’s family (as defined by FCA), nor the association’s directors, can knowingly purchase or otherwise acquire any interest in any real or personal property that is currently (or has been within the last 12 months) acquired and owned by the institution due to a foreclosure.
Governance and Membership FAQ's
When you borrow from Alabama Farm Credit you purchase $1,000 of its stock and become a stockholder in the association. Each voting stockholder, or, if a loan is made jointly to multiple borrowers or the stock is jointly owned, the designated voting stockholder, is entitled to vote in association matters brought before all shareholders, including most often the association’s annual director elections.
The benefit of a shareholder working with Alabama Farm Credit is first and foremost the expertise and insight of our team, the value of the mission-driven direction of the organization to see you succeed and share in the distributed profits of Alabama Farm Credit.
A director accepts fiduciary responsibility to act for the benefit of the association, including to oversee audits on behalf of the stockholder membership. The board meets an estimated 22 days a year. The primary functional responsibilities of the board are the safety and soundness of the financial institution and the vision and direction of the organization. The directors are the elected voice of membership in the association.
The board engages, separate from management, this structure of audits annually:
- (2) Internal credit reviews of the loan portfolio (each lasts 90 days)
- Internal controls audit (12 months; with quarterly deliverables)
- Financial report audit (10 months; includes quarterly financial statements)
- Collateral evaluation review (3 months)
Yes, AFC’s funding bank, Farm Credit Bank of Texas, engages its own internal credit review of the association with its own 3rd party.
By Farm Credit Administration regulations AFC is required to provide to a current stockholder, if requested in writing directly by the stockholder for a permissible purpose, a list of the association's current stockholders’ names, addresses, and classes of stock held. The association requires, as a condition to providing the list, that the stockholder agree and certify in writing that the stockholder will:
- Utilize the list exclusively for communicating with stockholders for permissible purposes; and
- Not make the list available to any person, other than the stockholder’s attorney or accountant, without first obtaining the written consent of the institution.
As used above in this answer, “permissible purposes” does not include communications involving commercial, social, political, or charitable causes, communications relating to the enforcement of a personal claim or the redress of a personal grievance, or proposals advocating that the bank or association violate any Federal, State, or local law or regulation.