FSA continues to develop innovative loan products and initiatives to improve its ability to serve traditionally underserved farmers and ranchers, such as with the Operating and Farm Ownership Microloan programs and the expansion of the Youth Loan program into urban areas. In its first full year of operation, more than 80 percent of Microloans went to beginning farmers, the underserved, and military veterans. Further, FSA is working to expand credit in areas where there are few lenders or where cultural or economic conditions limit the availability of credit.
With emphasis on organic and non-traditional or specialty agriculture enterprises, FSA uses resources made available from its partner Land Grant Universities and Extension Services with their networks of trained agricultural agents and specialists who are available nationwide to assist producers with instituting new production methods. These specialists are often called upon by producers and local FSA loan officers to assist in both the latest production practices and in developing accurate farm business plans.
While FSA is committed to serving all farmers and ranchers, by statute, FSA targets a portion of all Guaranteed loan funds, Direct Operating and Direct Farm Ownership loan funds, Microloan funding, and Youth loans, to historically underserved farmers and ranchers, which include:
- Alaskan Natives
- American Indians
- Native Hawaiians and Pacific Islanders.
*Loan application forms for Beginning Farmers are the same as those used by non-beginning farmer applicants. Please select the applicable loan type for applicable Farm Loan application forms.
Simultaneous requests for a direct farm ownership loan and a direct operating loan should be combined on a single application form.
When you meet with your FSA county Farm Loan Program staff, you may be asked to complete additional forms based on applicable loan program requirements for the loan type.
Loans to historically underserved and women farmers and ranchers are not a special type of loan program or loan type. Rather, this designation refers to a specific funding source known as Socially Disadvantaged Applicant (SDA) funding. To be considered for targeted funding, loan applicants must voluntarily provide race, ethnicity, and gender information.
You do not have to choose between identifying as an historically underserved individual or a beginning farmer, nor is there a "benefit" of deciding between one designation over the other. Identifying yourself as an historically underserved beginning farmer loan applicant is completely acceptable.
Loan Application Process
To be considered for targeted "SDA" loan funding, loan applicants must voluntarily provide his or her ethnicity, race and/or gender on the loan application. Otherwise, the Agency's loan process and loan requirements are identical for all loan applicants. There is no difference between historically underserved and women applicants and those who do not fall under this funding allocation other than the availability of targeted funding.
Down Payment Loan
The Direct Farm Ownership Down Payment loan is the only loan program specifically for historically underserved and women farmers and beginning farmers. Down Payment loan funds may be used only to partially finance the purchase of a family farm. Loan applicants must contribute a minimum downpayment of 5 percent of the purchase price of the farm and the Agency will finance 45 percent to a maximum loan amount of $300,000. The balance of the purchase price not covered by the down payment loan and the loan applicant's down payment may be financed by a commercial lender (pdf, 563KB), private lender, a cooperative, or the seller.
We encourage you to contact your local office or USDA Service Center to learn more about our programs. You should also be able to locate a listing in the telephone directory in the section set aside for governmental/public organizations under the U.S. Department of Agriculture, Farm Service Agency. Our local FSA office staffs are happy to help you and discuss our loan programs with you in more detail.