fsa farm loan opportunities - robert white
TRANSCRIPT
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USDA Farm Service Agency
Women Managing the Farm
2017 Conference
Our mission is to deliver timely, effective programs and
services to America’s farmers and ranchers to support them
in sustaining our Nation’s vibrant agricultural economy, as
well as provide first-rate support for domestic and
international food aid efforts.
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USDA FARM SERVICE AGENCY
• Kansas FSA:
– 96 County Offices in 105 Counties
– Management Team
• County Executive Director
• Farm Loan Manager/Officer
• Program Technicians
• County Committee (Farmer Elected)
• USDA Service Centers:
• Farm Service Agency (FSA)
• Natural Resources Conservation Service (NRCS)
• Rural Development (RD)
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Fiscal Year 2016 Accomplishments
• During FY 2016, Kansas funded 1,492 loan
applications. In excess of $221 Million was
provided in both Direct and Guaranteed loan
programs.
• Loans made increased more than $29 million
over FY 2015, or a 15% increase.
• The $221 Million loaned in FY 2016 equates
to approximately $879,500 every working
day.
Fiscal Year: October 1, 2015 – September 30, 2016
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Fiscal Year 2016 Accomplishments
Current Loan Portfolio
$807 million:
• 3,426 Direct borrowers with a total
indebtedness of $496 million.
• 987 Guaranteed borrowers with a
total indebtedness of $311 million
Fiscal Year: October 1, 2015 – September 30, 2016
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FARM LOAN PROGRAMS
Farm Loan Programs provide loans, loan guarantees, and business planning to eligible farmers, ranchers, and others to promote, build, and sustain family farms in support of a thriving agricultural economy.
Who are our potential customers?
• Beginning farmers and ranchers
• Farmers whose needs may not be met by commercial credit
• Multigenerational family farms
• Socially disadvantaged farmers and ranchers *
• Value added farming operations
• Organic and specialty farmers
• Farmers who have hit hard times and now require a safety net
EligibilityGeneral Eligibility Requirements typically include:
• Be an operator of a family farm;
• Not be delinquent on Federal debt;
• Have a satisfactory history of meeting credit obligations;
• Has not caused the Agency a loss through debt forgiveness;
• Must not have had a violation with Federal Crop Insurance;
• Be a citizen of the United States, US non-citizen national, or a qualified alien under applicable Federal immigration laws;
• Be within the time restrictions as to the number of years applicants can receive FSA assistance.
• Have sufficient managerial ability to assure reasonable prospects of loan repayment;
• For Direct Farm Ownership (FO) loans, applicants must have participated in the business operations of a farm or ranch for 3 years;
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Guaranteed Loans
FSA provides a guarantee of up to
95% to a commercial lender
(such as a Bank or Farm Credit).
Loan limit of $1,399,000.
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Guaranteed Loans
• Farm Ownership (FO) – Funds may
be used for the purchase or
improvement of real estate or
refinancing. Loan terms are limited to
40 years or less.
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Guaranteed Loans• Farm Ownership (FO)
• Operating (OL) - Funds may be
used to purchase machinery or
breeding livestock, or for
refinancing. Loan terms typically
limited to 7 years.9
Guaranteed Loans• Farm Ownership (FO)
• Operating (OL)
• Line of Credit (LOC) – Funds to
be used for annual crop or
livestock inputs. Maximum term of
5 years.10
Guaranteed Loans• Farm Ownership (FO)
• Operating (OL)
• Line of Credit (LOC)
• EZ Guarantee – Limited to $100,000,
simplified application process for any
of the above loan types and
purposes.11
Direct Loans
Loans are made and serviced by
FSA.
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Direct LoansFor FSA Farm Loan
Program (FLP) direct
loans: Eligibility
includes a requirement
that the Applicant be
unable to obtain
sufficient credit
elsewhere at
reasonable rates and
terms.
Examples:
– Inadequate
security margin
– Limited cash
flow
– New operation
– Recovering from
a financial loss13
Direct Loans
Farm Ownership (FO) – Direct FO
loans may include – Down
Payment, 50/50, and 100%.
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Down Payment FO Program
• Required down payment of 5%
• FSA’s interest rate is 1.5%, fixed
• Max loan term of 20 years
• FSA lends up to 45% of purchase price (FSA’s
portion not more than $300,000)
• 50% of financing from participating lender
• Must be an Underserved Applicant or Beginning
Farmer15
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• Loans to Beginning Farmers & Ranchers
– In addition to general eligibility requirements, a beginning
farmer/rancher may qualify to purchase real estate with the
following additional conditions:
• Has not operated a farm for more than 10 years.
• Does not own real farm property or who, directly or through
interests in family farm entities owns real farm property, the
aggregate acreage of which does not exceed 30% of the
average acreage of the farms in the county where the
property is located.
• The average farm size will be based upon information
obtained from the most recent Census of Agriculture.
Information on average farm size by acres is available at the
local FSA County Office.
FARM LOAN PROGRAMS
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Definition of Underserved Applicant for Farm Loan Purposes:A group whose members have been subject to racial, ethnic, or gender prejudice because of their identity as members of the group without regard to their individual qualities.
These groups consist of:
Women
American Indians
Alaskan Natives
Asians
Hispanics
Native Hawaiians or other Pacific Islanders
Blacks or African Americans
A certain percentage of farm loan program funding is targeted for Underserved Applicants.
FARM LOAN PROGRAMS
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FO Participation (50/50) Loan
• No minimum down payment required.
• FSA loans 50%, participating lender 50%.
• FSA loan rate of 2.5%, fixed for up to a 40
year term.
• $300,000 loan limit for FSA’s portion.
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FO 100% Loan
• No minimum down payment required.
• FSA loans up to 100%.
• FSA loan rate of 4% (Feb. 2017) fixed
for up to a 40 year term.
• $300,000 loan limit.
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Direct Loans• Farm Ownership (FO)
• Operating (OL) – Funds may be used for
annual inputs, or machinery and breeding
livestock purchases. In some cases, for
refinancing debts. A maximum term of 7
years, with amortizations up to 21 years.
2.875% interest rate (Feb. 2017) $300,000
loan limit.
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Direct Loans• Farm Ownership (FO)
• Operating (OL)
• Microloans – Loans up to $50,000,
reduced application requirements and
potentially less security necessary.
Either of the above loan types and
purposes.22
Marketing and distribution expenses
Purchase of livestock
Minor farm improvements such as
wells and coolers
Annual operating expenses such as
seed, fertilizer, utilities and land rents
Loan amount limited to $50,00023
~ FSA Microloans can include ~ Initial start-up expenses; such as: hoop houses to extend the
growing season
Essential tools or equipment needed for the operation
Irrigation equipment
Direct Loans• Farm Ownership (FO)
• Operating (OL)
• Microloans
• Emergency (EM) – Actual Loss loan
amounts are based on losses from a
declared disaster. Interest rate of
3.875% as of Feb. 2017. $500,000 loan
limit. 24
Direct Loans• Farm Ownership (FO)
• Operating (OL)
• Microloans
• Emergency (EM)
• Youth (YL) – For applicants 10 to 20
years old, participating in 4-H or FFA.
2.875% interest rate (Feb. 2017). $5,000
loan limit.25
Farm Storage Facility LoansIn addition to Farm Loan Program (FLP) loans, the
FLP staff in Kansas administer Farm Storage Facility
Loans (FSFL). The FSFL Program provides financing
for producers to build or upgrade farm storage and
handling facilities, as well as purchase of equipment.
Qualified facilities include grain bins, hay barns and
cold storage facilities. The current fixed rate for a
seven year loan is 2.25% (Feb. 2017). Unlike FLP
loans, eligible applicants may be able to obtain credit
elsewhere.
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Farm Service Agency, Farm Loan Programs
Guaranteed Loans
• Farm Ownership (FO)
• Operating (OL)
• Line of Credit (LOC)
• EZ Guarantee
Farm Storage Facility
Loans
Direct Loans
• Farm Ownership (FO)
• Operating (OL)
• Microloans
• Emergency (EM)
• Youth (YL)
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Farm Service Agency, Farm Loan Programs
For current interest rates, additional
information, or application materials see:
http://www.fsa.usda.gov/programs-and-
services/farm-loan-programs
or contact your local FSA Farm Loan Team
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Farm Service Agency, Farm Loan Programs
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Contact Information
Bob White, Farm Loan Chief
Kansas FSA State Office
3600 Anderson Ave
Manhattan, KS 66503
PH: 785-564-4759
Fax: 855-782-9610
USDA is an equal opportunity provider, employer, and lender
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