The Low-Interest Loans of the Farm Security Administration:
Above: An oil painting by Mary Winslow, created while she was in the WPA's Federal Art Project, 1936. By the end of fiscal year 1943, the New Deal's Farm Security Administration (FSA) had made Rural Rehabilitation Loans to over 900,000 farm families, including tens of thousands of African Americans (this includes loans made by the FSA's predecessor, the Resettlement Administration). These were relatively small loans, averaging $500 (about $12,000 in 2025 dollars), used for things like "tools, seed, feed, equipment, livestock," and had repayment terms of 5 years at 5% interest. The loans were made on faith, to farm families that the private sector had refused to lend to on reasonable terms: "The people were poor credit risks as judged by ordinary business standards. Yet, they have already returned nearly 200 million dollars in principal and interest to the Federal Treasury" (FSA annual report, 1941, p. 27). Image from the Smithsonian American Art Museum.
Above: "Tenant Farm," a lithograph by Anne Michalov (1904-2001), created while she was in the WPA, between 1935 and 1943. By 1943, the FSA, through the Bankhead-Jones Farm Tenant Act of 1937, had made 33,559 loans to tenant farmers to purchase their own farms, with repayment terms being 40 years at 3% interest. About 4,000 of these loans were made to African Americans. Repayment of the loans, like the Rural Rehabilitation Loans, was excellent, with many paying off their loans far earlier than required. Image from the University of Michigan Museum of Art and the General Services Administration.
Above: One of the many articles that can be found in newspaper archives, highlighting the good repayment record of New Deal borrowers. This excerpt is from the Buffalo Evening News (Buffalo, New York), December 30, 1940. Image from newspapers.com, used here for educational and non-commercial purposes.
Above: "The Farmer," a lithograph by Nicholas Panesis (1913-1967), created while he was in the WPA, between 1935 and 1943. In addition to low-interest loans, the Farm Security Administration gave grants to 620,000 farm families between 1935 and 1943, most of them during the earlier years, when conditions were worse, for example, severe drought. Image from the Gibbes Museum of Art and the General Services Administration.
Above: Walter Ross was in charge of the Home Owners' Loan Corporation (HOLC) for West Virginia, from July 1933 to about June 1936. In this position, he oversaw all of the HOLC loan-making in the state - 9,139 low-interest loans (generally about 5%) totaling $22,863,243, or about $546 million in 2025 dollars (see, e.g., Charles Lively, (ed.), West Virginia Blue Book, Charleston, WV: Jarrett Printing Company, 1936, p. 758). The primary purpose of HOLC was to save homeowners from foreclosure during the tough times of the Great Depression. This was done, in part, by providing low-interest loans directly to the home owners. Across the nation, HOLC made over 1 million low-interest loans, with $575 million going directly to individuals (about $13 billion in 2025 dollars - for more details, see the Living New Deal's summary of the "Home Owners’ Loan Act (1933)"). The editors of the West Virginia newspaper Wheeling Register wrote that "the whole HOLC layout is another argument for being thankful that we live in a country where the administration that is now handling the country's affairs is doing so many things --the making of HOLC loans but one out of many--to help the average citizen" ("West Virginia and the HOLC," reprinted in The Sunday [Raleigh] Register (Beckley, West Virginia), August 4, 1935, p. 4). Photo above from the West Virginia Blue Book, 1935 edition.
The Low-Interest Loans of the Federal Credit Unions:
Above: FDR signed the Federal Credit Union Act into law on June 26, 1934 "to establish a further market for securities of the United States and to make more available to people of small means credit for provident purposes through a national system of cooperative credit, thereby helping to stabilize the credit structure of the United States" (see the Living New Deal summary, "Federal Credit Unions (1934)"). Image scanned from a personal copy of the postage stamp.
Above: Federal Credit Unions--just like the state-chartered credit unions before and alongside them--were designed to give working-class Americans an alternative to usury. This newspaper excerpt is from the El Paso Herald-Post (El Paso, Texas), October 31, 1934, p. 6. Image from newspapers.com, used here for educational and non-commercial purposes.
Above: Tom Doig, director of the Credit Union National Association (U.S.-based), was a big proponent of credit unions as an alternative to usury. This newspaper excerpt is from The Vancouver Sun (Vancouver, British Columbia), June 26, 1944. In 1941, in a widely published article about the growth of credit unions (both federal and non-federal), journalist and publisher Frederic J. Haskin pointed out that "Credit union interest rates are, on the average, much lower than rates charged by banks... Interest on credit union loans is not more than 1 per cent per month on the unpaid balance" ("Credit Unions and Savings," The Billings Gazette (Billings, Montana), October 9, 1941). Image above from newspapers.com, used here for educational and non-commercial purposes.
Above: By the end of 1943 (the end of the core New Deal years), there were nearly 4,000 federal credit unions in operation, with 1.3 million members. The credit unions had made over 5.3 million loans since the start of the Federal Credit Union system, totaling over $579 million (about $13.5 billion in 2025 dollars). Statistics and map from: Federal Deposit Insurance Corporation, Annual Report of Operations: Federal Credit Unions, December 31, 1943, Washington, DC: U.S. Government Printing Office, 1944.
Above: Ever since FDR signed them into law, Federal Credit Unions have played an increasingly important role in the national economy. Today, there are close to 5,000 federally-insured credit unions (but it's important to remember that not all federally-insured credit unions are federal credit unions) with over 135 million members (see, National Credit Union Administration, "Quarterly Credit Union Data Summary, 2022 Q4," accessed June 19, 2026). Image from a Federal Security Agency report for 1948.
The Low-Interest Loans of the Public Works Administration:
Above: Railroad workers in Pennsylvania, on work financed by the New Deal's Public Works Administration (PWA), ca. 1935. The PWA awarded both grants and loans to governments and industries. One of the most impressive group of loans was $200,000,000 to 32 different railroads (about $5 billion in 2025 dollars). These loans put endless thousands of people back to work--not just in the railroads but also in industries that supported or were dependent upon the railroads--and was also one of the main drivers behind the streamline era of trains, an era that introduced the public to exciting new train designs, innovations, and comforts. For its thousands of loans to government and industry, the PWA explained that it "established an interest rate of 4 percent, with the thought that this would be low enough to help communities in need of assistance [as they were having trouble getting rates lower than 5%], and yet high enough so as not to interfere with private investors in a normal municipal market" (Public Works Administration, America Builds: The Record of PWA, Washington, DC: U.S. Government Printing Office, 1939, pp. 62-63). Photo from the National Archives.
The Low-Interest Loans of the Rural Electrification Administration:
Above: In its 25th anniversary booklet, the North Pine Electric Co-Op of Finlayson, Minnesota (now merged in to the East Central Energy electric cooperative), explained that it's first loan from the New Deal's Rural Electrification Administration (REA) came in 1940, for $162,000 (about $3.7 million in 2025 dollars), with repayment terms of 25 years at 2.46% interest. These terms, as well as terms for all other REA loans, was changed to 35 years and 2% interest by the Pace Act, which FDR signed into law on September 22, 1944. By the end of fiscal year 1959, the REA had made loans to 1,031 organizations (largely electric cooperatives), to install 1.4 million miles of power lines, serving over 4.6 million consumers (Rural Electrification Administration, Rural Lines USA: The Story of the Rural Electrification Administration's First Twenty-five Years, 1935-1960, Washington, DC: U.S. Government Printing Office, 1960, p. 55). Image above scanned from a personal copy.
The Low-Interest Financing of the Electric Home and Farm Authority:
Above: The New Deal's Electric Home and Farm Authority (EHFA, 1934-1942) helped many Americans purchase electric appliances on reasonable terms, such as the 5% down, 5% interest, and 5 year payment plan shown in this advertisement from the San Pedro News-Pilot (San Pedro, California), December 9, 1936. During its existence, the EHFA facilitated the purchase of "431,453 appliances and wiring installations" (Michelle Mock, "The Electric Home and Farm Authority, 'Model T Appliances,' and the Modernization of the Home Kitchen in the South," The Journal of Southern History, Vol. 80, No. 1 (February 2014), p. 105, citing James L. Dougherty to Charles H. Henderson, August 10, 1942, Box 5, Subject File, EHFA Records [National Archives, Record Group 234]. Image from newspapers.com, used here for educational and non-commercial purposes.
The Low-Interest Financing of the United States Housing Authority:
Above: A page from the booklet New Cities, New Citizens: The Program of the United States Housing Authority (Washington, DC: U.S. Government Printing Office, ca. 1938). By the end of fiscal year 1941, hundreds of public housing developments had been started or completed for tens of thousands of families across the nation (see, e.g., Federal Works Agency, Second Annual Report, Federal Works Agency, 1941: Fiscal Year Ended June 30, 1941, Washington, DC: U.S. Government Printing Office, 1941, pp. 118-119). USHA, and the cities and towns it assisted, employed a number of financing policies and strategies--including the utilization of private capital--to keep loan interest rates extremely low, thereby keeping rents low too. These policies and strategies (some of them mandated by USHA's enabling legislation) are discussed in the USHA's annual reports (available at Hathitrust, here). Public housing has always received much criticism in the U.S.--some of it deserved (e.g., the unsightly architecture of some of the developments), but a lot of it overblown--yet it must be remembered that public housing tenants often came from slums, where disease was prevalent but clean drinking water, good sanitation, sufficient heating, and safe play areas for children were not. Further, to pour salt into the wound, they had frequently paid high rent for that substandard housing. The New Deal wanted to change that, and was successful in many cases. Image above scanned from a personal copy.
"We the People" lending to "We the People," on reasonable terms
There were other New Deal agencies that engaged in or facilitated lending activity--to governments, groups, or individuals, on reasonable terms--such as the Reconstruction Finance Corporation (RFC, started under the Hoover Administration and greatly expanded under FDR); the Commodity Credit Corporation (CCC); the Department of Interior's management of revolving credit funds for American Indians (under the Indian Reorganization Act of 1934, the "Indian New Deal," and subsequent legislation); and the Federal Housing Administration (FHA). Unfortunately, FHA, while playing a key role in the dramatic increase in home ownership rates in America (especially from about 1940 to 1965), perpetuated the nation's cultural tradition of segregation (see, "New Evidence on Redlining by Federal Housing Programs in the 1930s," by Price Fishback, Jonathan Rose, Ken Snowden, Thomas Storrs, January 2022, a working paper on the website of the Federal Reserve Bank of Chicago, accessed June 20, 2026).
In a remarkable instance of 0% lending, "Fifty miners, who suffered much during the peak of the depression, are at Arthurdale, in Preston County [West Virginia], where these men, their wives, and children are living in modern, well-equipped houses which they are buying from the [New Deal] government. A few years ago they called dingy, poorly furnished mining camp shacks 'homes,' but today the story is a different one. When the Arthurdale homestead project is in full swing, 200 families will be living in homes located on five-acre plots of rich farm land... The government is selling the homesteaders houses and land at an average cost of $4,500 [about $110,000 in 2025 dollars], the payments over a 20-year period averaging $19.50 a month. No interest is added..." (U.S. Congressman Jennings Randolph, "Arthurdale Homesteads," in: Charles Lively (ed.), Hand Book and Manual and Official Register (The Blue Book), West Virginia Legislature, Charleston, WV: Jarrett Printing Company, 1934, p. 629, emphasis added).
Many of the New Deal's lending and lending-related agencies interacted with one another in complex ways. But complexity aside, we can clearly see that the New Deal made or facilitated millions of low-interest loans, for the benefit of tens of millions of Americans - not only the direct borrowers but also their families, as well as the businesses and employees that enjoyed increased sales and economic activity.
In sum, New Deal low-interest lending helped stimulate the economy; restored jobs; saved homes and farms; provided electric power and appliances to rural America (and many thousands of public works all over); offered credit to people, governments, and organizations that couldn't obtain decent credit terms--or any credit terms at all--elsewhere; and provided alternatives to loan sharks and usury. Perhaps most significantly, many borrowers of New Deal loans were considered high-risk and thus dismissed by the private sector as unworthy; yet, repayment was excellent. All of this can inform public policy today, since many Americans are still mired in the world of predatory lending, and still considered unworthy.
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