Merlyn and Vera Brauner have been growing corn and soybeans in northeast Nebraska since 1955. This year may be their last.

Like many farmers, the Brauners are mired in debt -- most of it contracted in the halcyon days of the 1970s when crop prices were booming, land prices were climbing and the federal government was encouraging increased production.

"I overbought. Then everything went against me. I'm in a hole," said Merlyn Brauner, who added 80 acres to his holdings a few years back. The Brauners hope to put in a 1985 crop -- if they still own their land.

Farm bankruptcies are rising across the country. More common are cases like that of the Brauners, who have done everything they can to avoid going out of business while they watched the value of their land decline and their net incomes become net losses.

Things have been deteriorating for the Brauners and most other farmers for the last four years. Prices have sagged. Interest rates have been high. Costs of production -- from machinery to fertilizer to fuel -- have risen far more than productivity. Land prices, the linchpin of the farm economy and the farmers' wealth, have sunk. And the prices of their crops and livestock have been distressingly low.

Many farmers like the Brauners borrowed to buy high-priced land in the 1970s. Most did so to expand their operations, to spread the costs of machinery and labor over more acreage. The Brauners bought land they had been renting so they wouldn't lose it. Now the farmland has plunged in value.

Newman Grove farmland that was worth $1,800 an acre just a few years ago is worth $1,200 or less today. The story is the same all over the Farm Belt, although the decline has not been as precipitous in some areas, such as the cornfields of central Illinois where the soil is better and irrigation isn't needed. "The farmers who borrowed to expand their operations in the late 1970s are the first to go," according to an official of a bank near Newman Grove.

Merlyn Brauner is 60. Vera Brauner is 55. After 30 years of farming together, they are worried that they may have to sell all their land and machinery and that those assets may not fetch enough to pay their debts -- which total more than $200,000.

"If we sell, we'll be living on food stamps. There won't be enough for us to go to town and buy a house," Vera Brauner said.

There is still money to be made in farming -- although not as much as there was a few years ago. But most of those who are breaking even or making a few dollars in the fields around Newman Grove have no land debt or very little.

Gary Duhachek, who farms 1,100 acres near Newman Grove, still is making some money. But he wouldn't be if he had not sold 320 acres over the last two years. The sales lifted $65,000 a year in interest payments from his shoulders.

Farmers don't like to sell land, he said. "But you ask yourself, 'Do you own the land or does the land own you?' "

E. H. (Bud) Gerhart, president of the First National Bank of Newman Grove, is the main commercial banker for Duhachek and the Brauners. Gerhart said that the Brauners are among his most troubled borrowers, while Duhachek is among his strongest.

During the first eight months of this year, 152 Nebraska farmers filed for bankruptcy, more than 12 times as many as in the same period of 1980. So far, none of Gerhart's customers has failed. But between 15 and 25 of his 150 large farm customers -- those who borrow more than $50,000 -- could be seriously stretched this year, he said. The Brauners are among them.

"A lot of fellows don't know if they're going to make it until their crops come out," said Gerhart. In the farm country around Newman Grove, about 125 miles northwest of Omaha, the problem of getting the crop out is beginning to overshadow low prices and high costs.

Most of those crops -- mostly corn and soybeans -- should be out by now. But nearly continuous rain this month has left the fields too muddy for the combines. Soybeans should be out of the ground by now -- at best 25 percent are. Nearly all the corn is uncut. The corn can survive until the ground freezes enough to support the combines. But by then, most of the beans could be lost.

Soybeans have become an increasingly popular crop for cash-strapped farmers because they are far less expensive to plant than corn. Robert C. Nelson, another Gerhart customer whose future may hang on the crop in the field, estimated that it costs him about $116 an acre to plant corn and only $68 to plant beans.

Gerhart, president of the only bank in this community, said his institution is strong. But he said he is concerned about his bank and about his customers. Roughly 90 percent of the $11.5 million of loans on his books are farm loans. If the weather does not improve, his estimate that 15 to 25 of his customers could be troubled might be low, he said.

Like most commercial banks in the Farm Belt, First National has concentrated on making short-term loans -- for machinery or to finance the farmers' planting, growing, harvesting and living expenses. Commercial bankers left long-term land lending to other organizations in the farm credit system, such as the Federal Land Bank -- which holds a mortgage on 240 of the 280 acres the Brauners own (they rent another 40 acres).

Despite their distaste for land loans, bankers have found themselves making them to farmers such as the Brauners who need funds to pay their long-term lenders. The borrowers give a lien to their banks on land they own free and clear.

Last year, for example, Gerhart permitted the Brauners to postpone repayment of $15,000 of the crop loan so they could pay their mortgage debt. Gerhart took a lien on the last 40 acres the Brauners owned free and clear. The land is worth $40,000 or more, so Gerhart said he feels well-protected. But if the Brauners are going to make it through to 1985, they probably will have to borrow more from First National against the equity they have remaining in that 40 acres.

Last year the Brauners sold 120 acres (including 80 that Vera Brauner had inherited) and used the $186,000 they realized to pay back bills and reduce some of the outstanding debt on their remaining land. But it wouldn't have been enough had Gerhart not agreed to convert $15,000 of the 1983 crop loan to a mortgage.

Merlyn Brauner hoped for a good year in 1984. Instead, he already knows he going to go deeper in the hole. "I ain't going to break even," he said. "I don't know if there's going to be a next year."

Unlike most farmers in Newman Grove, Brauner has harvested his soybeans. But his poor soybean harvest threw his financial planning -- and the basis for repaying the $49,000 crop loan from Gerhart -- off kilter. Brauner expects that his corn crop will be bountiful, when he can get it out of the ground. But he said that he also expects a low price.

At current prices, the Brauners should earn about $80,000 from their harvest. But their expenses are far higher. Interest payments total about $30,000. They owe $49,000 in principal to First National and $7,500 to the mortgage holder on the 80 acres they once rented. They also owe the local cooperative $5,700 for seed and the government an overpayment of nearly $1,500 they received last year from the administration's Payment in Kind program designed to reduce farm output. Their total PIK payment was less than $1,900.

Gerhart said he will not pull the plug on the Brauners, but said the Federal Land Bank is the key to the Brauners' survival.

First National, which has been owned by the Gerhart family for nearly 90 years, will lend them enough money to pay the principal and interest on the 80-acre mortgage and add it to the $15,000 loan carried over from last year. The bank probably will have to carry over part of the 1984 crop production loan. All will be secured by the 40 acres Gerhart took the lien against last year. The land is worth about $40,000 today.

First National also will lend the Brauners enough money to buy some cattle that they will fatten from 400 to 700 pounds by feeding them roughage and silage they already have. The Brauners, still optimistic, hope to make an $11,500 profit -- out of which they'll pay the cooperative and the government and have some money left over to pay for heat, electricity and food.

Whether First National will be able to make a crop loan for the 1985 season depends on whether the Federal Land Bank is willing to let the Brauners' Jan. 1 payment of $15,000 slide, Gerhart said. If the cooperative lending institution demands payment, the Brauners probably will have to sell out.

The Brauners don't blame their banker. They say Gerhart has been understanding.

But Gerhart, whose son joined the bank a few years ago and whose 86-year-old father is chairman, said he is not as popular as he was when times were good.

"I'm not a big-city banker. I grew up with most of my customers," he said. Gerhart and Vera Brauner were high school classmates.

But a banker in a town near Newman Grove said some of his customers have grown hostile. "They've got to blame someone," he said.