Farm Loans

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Farm Loans

The 2014 Farm Bill contains numerous modifications to Farm Loan Programs that will benefit producers and provide additional support for beginning farmers and veterans.

Several changes have already been implemented, including:

  • Elimination of Guaranteed Operating Loan term limits.
  • Definition of Beginning Farmer modified to use the average farm size for the county as a qualifier instead of the median farm size.
  • Joint Financing Direct Farm Ownership Interest Rate is modified to 2 percent less than regular Direct Farm Ownership rate with a floor of 2.5 percent. Previously, the rate was 5 percent.
  • Direct Farm Ownership down payment program maximum loan amount increased from $250,000 to $300,000.
  • Rural residency requirement for Youth Loans was eliminated, allowing urban youth to benefit.
  • Debt forgiveness for Youth Loans because of circumstances beyond the borrower’s control will not prevent a borrower from obtaining additional loans from the federal government.
  • Delinquency on or debt forgiveness for Youth Loans will not prevent the borrower from receiving federal student loans.
  • Guarantee amount on Conservation Loans increased from 75 to 80 percent (90 percent for socially disadvantaged borrowers and beginning farmers).

Microloans made to a beginning or veteran farmer will not count toward direct operating term limits.

Additional program modifications contained in the Farm Bill must be implemented through the rulemaking processes and updates will be posted as they become available.