Farm Ownership Loans
Farm Service Agency’s loan programs are designed to help family farmers obtain loans and loan guarantees through the extension of credit and supervisory assistance to become owner-operators of not larger than family farms; make efficient use of the land, labor, and other resources; carry on sound and successful farming operations; and enable farm families to have a reasonable standard of living.
General information about this opportunity
Last Known Status
Agency: Department of Agriculture
Office: Farm Service Agency
Type(s) of Assistance Offered
DIRECT LOANS; GUARANTEED/INSURED LOANS
Fiscal Year 2014: Actual Direct Farm Ownership loans made in FY 2014 were 5,522 for total obligations of $999,667,000.
Actual Guaranteed Farm Ownership loans made in FY 2014 were 4,584 for total obligations of $2,012,782,000. Fiscal Year 2015: The Agency estimates 8,876 Direct Farm Ownership loans being made in FY 2015 for total obligations estimated at $1,500,000,000. Through July 29, 2015 there were 4,438 loans made with a value of $803,008,000.
The Agency estimates 4,785 Guaranteed Farm Ownership loans being made in FY 2015 for total obligations estimated at $2,000,000,000. Through July 29, 2015 there were 3.634 loans made with a value of $1,683,936,000. Fiscal Year 2016: The Agency estimates 8,876 Direct Farm Ownership loans being made in FY 2016 for total obligations estimated at $1,500,000,000.
The Agency estimates 4,785 Guaranteed Farm Ownership loans being made in FY 2016 for total obligations estimated at $2,000,000,000.
Consolidated Farm and Rural Development Act, as amended, Subtitle A, Sections 302, 310D, Public Laws 100-233, 87-128, 91-620, 95-334, 97-98, 7 U.S.C. 1922; Section 303, Public Laws 87-708, 90-488, 95-113, 96-438, 7 U.S.C. 1923; Section 305, Public Law 92-419, 7 U.S.C. 1925; Section 307, Public Law 97-35, 7 U.S.C. 1927; Section 308, Public Laws, 87-798, 89-240, 92-133, 7 U.S.C. 1928; 7 U.S.C. 1934.
Who is eligible to apply/benefit from this assistance?
An applicant must: (1) Be a citizen of the Untied States, United States non-citizen national, or a qualified alien under applicable Federal immigration laws; (2) have the legal capacity to incur the obligations of the loan; (3) be unable to obtain credit elsewhere or unable to obtain the loan without a guarantee; (4) not have had a previous loan which resulted in a loss to the Agency (with certain conditions); (5) not be delinquent on any federal debt; (6) after the loan is closed, be an owner/tenant operator of a family farm. For an operating loan (OL), the producer must be the operator of a family farm; (7) have participated in the business operations of a farm for at least 3 out of the 10 years prior to the appilcation (for direct loans only); (8) not have been convicted of crop insurance fraud (in certain circumstances); and (9) not have any controlled substance convictions. In addition, a direct loan applicant must have sufficient education, training, or experience in managing and operating a farm or ranch that demonstrates the managerial ability to succeed in farming. Corporations, cooperatives, joint operations, and partnerships and their members/stakeholders must meet most of these same eligibility requirements, and the entity must also be authorized to operate a farm or ranch in the State where the land is located. To be eligible to obtain a direct loan, a borrower must agree to abide by any "borrower training" requirements. Applicants/borrowers requesting guaranteed loan assistance must meet all lender requirements.
Applicants/borrowers are the direct beneficiaries and must meet the applicant eligibility requirements. Families, individuals, and entities who are or plan to become farmers, ranchers or aquaculture operators are the beneficiaries.
Applicants for direct loans must be unable to obtain credit elsewhere and applicants for guaranteed loans must be unable to obtain credit without the guarantee. This program is excluded from coverage under 2 CFR 200, Subpart E - Cost Principles.
What is the process for applying and being award this assistance?
Preapplication coordination is not applicable. Environmental impact information is not required for this program. This program is excluded from coverage under E.O. 12372.
This program is excluded from coverage under 2 CFR 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards. Applicants may apply for direct loans at local FSA offices. Guaranteed loans may be available from local commercial lenders who apply for loan guarantees from FSA.
FSA determines if the applicant is eligible and reviews the application for repayment ability, security, and compliance with other regulations, approves and obligates the loan.
Approval/Disapproval Decision Time
The loan approval official approves or disapproves a completed application. The average approval time for direct loans is 30 days and 10 days for guaranteed loans.
From 30 to 60 days. Applicants for direct and guaranteed loans may appeal adverse action taken. The applicant is given an opportunity to appeal the decision to the National Appeals Division. The applicant may, in the final step of the appeals process, request a review by the Director, National Appeals Division, Washington, DC.
Applicants may reapply at any time. Applicants denied assistance through the appeal process must establish that substantial change has occurred, since the denial decision.
How are proposals selected?
How may assistance be used?
Loan funds may be used to: (1) Enlarge, improve, and purchase farmland; (2) construct or repair buildings and other fixtures; (3) develop farmland to promote soil and water conservation; (4) provide facilities to produce fish under controlled conditions. Guaranteed farm ownership loans may be used to refinance debts under certain conditions.
What are the requirements after being awarded this opportunity?
No reports are required.
No audits are required for this program.
Records on production, income, expenses during the period of the loan.
Other Assistance Considerations
Formula and Matching Requirements
This program has no statutory formula.
Matching requirements are not applicable to this program.
MOE requirements are not applicable to this program.
Length and Time Phasing of Assistance
.Loans justified may be scheduled over a period up to 40 years. The interest rate for guaranteed loans is negotiated between the lender and borrower. See the following for information on how assistance is awarded/released: loan funds may be dispersed in lump sum or increments. See the following for information on how assistance is awarded/released: loan funds may be dispersed in lump sum or increments.
Who do I contact about this opportunity?
Regional or Local Office
None. Contact the appropriate FSA State Office listed in Appendix IV of the Catalog. Vist the FSA website at www.fsa.usda.gov.
Connie Holman 1400 Independence Avenue, SW, Washington, District of Columbia 20250 Email: firstname.lastname@example.org
12-4213-0-3-351 - Guaranteed Loans Financing Account; 12-1140-0-1-351; 12-4212-0-3-351 - Direct Loans Financing Account.
(Direct Loans) FY 14 $999,667,000; FY 15 est $1,500,000,000; and FY 16 est $1,500,000,000. (Guaranteed/Insured Loans) FY 14 $2,012,782,000; FY 15 est $2,000,000,000; and FY 16 est $2,000,000,000
Range and Average of Financial Assistance
Direct Farm Ownership Loans up to $300,000;
Guaranteed Farm Ownership Loans up to $1,392,000. (amount adjusted annually)
FY 2014; Direct Farm Ownership Loan average loan size $181,034.
FY 2014; Guaranteed Farm Ownership Loan average loan size $439,089.
Average amount owed by direct borrower is $120,687.
Average amount owed by a guaranteed borrower is $348,000.
Regulations, Guidelines and Literature
7 CFR, Part 761, 762, & 764.
Farm Service Agency Fact Sheets;
FSA Handbook 1 FLP, 2 FLP & 3 FLP;
FSA Program Aids 1610 "Farm Service Agency Producers Guide to Loan Programs", 1620 "Lender's Guide to FSA Loan Programs";
FSA Brochure FSA-BR-01 "Your Guide to FSA Farm Loans"
above information is avialable on FSA website at:www.fsa.usda.gov.
Examples of Funded Projects