USDA expands access to credit to help more beginning and family farmers

The U.S. Department of Agriculture (USDA) recently announced improvements to farm loan programs by expanding eligibility and increasing lending limits to help more beginning and family farmers. As part of this effort, USDA is raising the borrowing limit for the microloan program from $35,000 to $50,000; simplify the lending processes; updating required “farming experience” to include other valuable experiences; and expanding eligible business entities to reflect changes in the way family farms are owned and operated. The changes become effective Nov. 7.

The microloan changes will allow beginning, small and mid-sized farmers to access an additional $15,000 in loans using a simplified application process with up to seven years to repay. Microloans are part of USDA’s continued commitment to small and midsized farming operations.

In addition to farm related experience, other types of skills may be considered to meet the direct farming experience required for farm loan eligibility such as operation or management of a non-farm business, leadership positions while serving in the military, or advanced education in an agricultural field. Also, individuals who own farmland under a different legal entity operating the farm now may be eligible for loans administered by USDA’s Farm Service Agency (FSA). Producers will have an opportunity to share suggestions on the microloan process, and the definitions of farming experience and business structures through Dec. 8, 2014, the public open comment period.

FSA is also publishing a Federal Register notice to solicit ideas from the public for pilot projects to help increase the efficiency and effectiveness of farm loan programs. Comments and ideas regarding potential pilot projects will be accepted through Nov. 7, 2014.

For more information on farm loans, please visit www.fsa.usda.gov or contact your local Farm Service Agency office.