USDA Secretary Tom Vilsack today announced modifications to the department's Farm Service Agency (FSA) Farm Loan Program that increases opportunities for producers in association with the 2014 Farm Bill. The changes that will take effect immediately include the following:
- Elimination of loan term limits for guaranteed operating loans.
- Modification of the definition of beginning farmer, using the average farm size for the county as a qualifier instead of the median farm size.
- Modification of the Joint Financing Direct Farm Ownership Interest Rate to 2% less than regular Direct Farm Ownership rate, with a floor of 2.5%. Previously, the rate was established at 5%.
- Increase of the maximum loan amount for Direct Farm Ownership down payments from $225,000 to $300,000.
- Elimination of rural residency requirement for Youth Loans, allowing urban youth to benefit.
- Debt forgiveness on Youth Loans, which will not prevent borrowers from obtaining additional loans from the federal government.
- Increase of the guarantee amount on Conservation Loans from 75% to 80% and 90% for socially disadvantaged borrowers and beginning farmers.
- Microloans will not count toward loan term limits for veterans and beginning farmers.
For more details on the changes to FSA farm loans, check out this fact sheet.
Additional modifications must be implemented through the rulemaking processes. Visit the FSA Farm Bill website for detailed information and updates to farm loan programs.