Recently, dairy and livestock producers have been struggling financially with low milk and livestock prices. It does not appear that this situation is going to improve in the short term. Ag Secretary Tom Vilsack has announced that USDA is undertaking an effort to use the department’s administrative flexibility to provide relief to producers in struggling agriculture industries.
Secretary Vilsack has ordered the Farm Service Agency to use all available means to help producers who have been hit by worsening economic conditions. The assistance includes FSA’s increased effort to provide loan assistance to livestock producers. The goal is to assist producers get through these tough economic times.
Producers can apply for direct operating loans of up to $300,000. Direct operating loans can be used for most farm related expenses, including refinancing debts except for real estate debts. Applicants must meet the loan eligibility requirements including being unable to obtain credit elsewhere at reasonable rates and terms.
Direct farm ownership (real estate) loans can only be used to purchase or improve real estate. FSA loan officers can also work with producers to help them secure FSA guaranteed farm operating and/or guaranteed farm ownership loans of up to $1,094,000 at an interest rate negotiated with the lender.
Guaranteed operating loans can be used for most farm related expenses including refinancing debts. Guaranteed farm ownership loans can be used to purchase or improve real estate and to refinance debts including real estate debts. The terms of each loan are determined on a case by case basis.
Commercial lenders (Farm Credit, banks, savings and loans) can make FSA guaranteed loans. Contact your local FSA office for a list of participating lenders.
FSA is encouraging guaranteed lenders to use all available options to assist present guaranteed borrowers and new applicants. The options include interest only loan payments, deferred initial loan payments and uneven payment plans. Options for present borrowers include lowering loan payments through rescheduling or reamortizing the loans.
FSA can consider varied payment plans for direct operating loans including uneven payments, interest only payments the first year and other payment options. Present FSA borrowers can apply for loan servicing options including loan rescheduling, reamortization and payment deferral.
Additional information on Farm Service Agency farm loan programs may be obtained by contacting local FSA offices or through the FSA Web site at www.fsa.usda.gov and click on “Farm Loans.”
For detailed information on FSA farm loans, contact your local Farm Service Agency county office to set up a meeting with a farm loan officer. Loan applications can be obtained from the Web site or by contacting the Farm Loan team for your county.
That’s all for now,