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Fact Sheets

March 2014

New Farm Bill Offers Modifications to Farm Loan Programs



The 2014 Farm Bill, signed by President Obama on Feb. 7, 2014, updates certain requirements and modifies several loan programs administered by the Farm Service Agency (FSA).

Actions FSA Customers Can Expect to Take Effect Immediately

The following will be implemented immediately due to the 2014 Farm Bill.

  • The percent of guarantee offered on all Conservation Loans (CL) will increase from 75 percent to 80 percent. The percent of guarantee will increase to 90 percent for CLs made to socially disadvantaged (SDA) and beginning farmers.
  • The interest rate charged on Direct Farm Ownership loans that are made in conjunction with other lenders is set at 2 percent below the regular Direct Farm Ownership rate, with a floor of 2.5 percent.
  • The requirement for FSA to appraise the value of oil, gas, or other minerals to be used as collateral for Farm Ownership loans has been removed.
  • The maximum loan amount for down payment Farm Ownership loans increased to $300,000 from $225,000, consistent with all other Direct Farm Ownership loans.
  • The rural residency requirement for Youth Loans (YL) is removed. Previously, to qualify for a YL an applicant had to live in a rural area.
  • Microloans made to beginning and veteran farmers or ranchers are exempt from direct term limits. Term limits still apply for non-microloan direct loans (regular operating loans and Farm Ownership loans).
  • A limited resource rate is available to beginning and veteran farmers who receive a Microloan. Borrowers will be given a choice to accept the limited resource rate or regular operating loan rate.
  • The restriction that an applicant could receive a Guarantee Operating Loan (OL) for no more than 15 years has been eliminated.
  • The definition of a qualified beginning farmer or rancher is modified to set the average size of farmland owned at no greater than 30 percent of the average size farm. Previously, this definition used the median farm size which eliminated many otherwise qualified applicants.
  • Debt forgiveness will no longer preclude a former Youth Loan (YL) borrower from obtaining additional loans from any U.S. government agency. Additionally, borrowers with YL debt forgiveness or who are delinquent on YL debt can receive student loans. The servicing and collection of YLs is not affected by the statute and will continue under the present regulation. FSA is revising the definition of debt forgiveness to comply with this statute.

Additional information regarding FSA Farm Loans or other FSA programs can be found by visiting a nearby FSA Service Center or online at

The U.S. Department of Agriculture (USDA) prohibits discrimination against its customers, employees, and applicants for employment on the bases of race, color, national origin, age, disability, sex, gender identity, religion, reprisal, and where applicable, political beliefs, marital status, familial or parental status, sexual orientation, or all or part of an individual’s income is derived from any public assistance program, or protected genetic information in employment or in any program or activity conducted or funded by the Department. (Not all prohibited bases will apply to all programs and/or employment activities.) Persons with disabilities, who wish to file a program complaint, write to the address below or if you require alternative means of communication for program information (e.g., Braille, large print, audiotape, etc.) please contact USDA’s TARGET Center at (202) 720-2600 (voice and TDD). Individuals who are deaf, hard of hearing, or have speech disabilities and wish to file either an EEO or program complaint, please contact USDA through the Federal Relay Service at (800) 877-8339 or (800) 845-6136 (in Spanish).

If you wish to file a Civil Rights program complaint of discrimination, complete the USDA Program Discrimination Complaint Form, found online at, or at any USDA office, or call (866) 632-9992 to request the form. You may also write a letter containing all of the information requested in the form. Send your completed complaint form or letter by mail to U.S. Department of Agriculture, Director, Office of Adjudication, 1400 Independence Avenue, S.W., Washington, D.C. 20250-9410, by fax (202) 690-7442 or email at USDA is an equal opportunity provider and employer.




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