Friday, March 29, 2024

Targeted farm loan funding reminder

Posted

Old McDonald had a farm and the USDA offered him farm loan funding - if he was an underserved applicant or a beginning farmer or rancher. The United States Department of Agriculture sent out a news release to remind producers that the Farm Service Agency offers fiscal help if applicable.
    In the past fiscal year, the Washington Farm Service Agency provided over $34 million in loans to beginning farmers and ranchers along with underserved borrowers. Farmer Service Agency sets aside a portion of loan funds just for the purpose of aiding those who fit the requirements. Since farming and ranching is a capital intensive business, the FSA strives to help producers both start and maintain their individual agricultural operations. So whether one is just beginning to put down roots or if one falls into a class that has been historically marginalized - whether that be racial, ethnic or gender prejudice - then they are eligible for a loan.
    According to the release, the USDA considers underserved groups to be women, African Americans, American Indians, Alaskan Natives, Hispanics, Asians and Pacific Islanders. A beginning farmer is defined as an individual or entity members that have operated a farm for less than ten years and all direct farm ownership applicants must have participated in the business operations of the farm for at least three out of the ten years. Along with that, if the applicant is an entity, the members have to be related by blood or marriage, with all entity members being eligible beginning farmers.
    Those who cannot receive commercial credit from a bank are able to apply for either direct loans or guaranteed loans from FSA. Direct loans are directly from FSA whereas guaranteed loans are made by lending institutions who arrange for FSA to guarantee the loan. So in one situation the FSA is the middle man and in the other, it serves as a direct source.
    The release states that the direct and guaranteed loan program offers two types of loans, farm ownership loans and farm operating loans.

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