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The 2014 Farm Bill offers increased opportunities for producers including farm loan program modifications that create flexibility for new and existing farmers. A fact sheet outlining modifications to the U.S. Department of Agriculture’s (USDA) Farm Service Agency (FSA) Farm Loan Programs is available at http://fsa.usda.gov/Internet/FSA_File/2014_farm_bill_change_flp.pdf


The Farm Bill expands lending opportunities for thousands of farmers and ranchers to begin and continue operations, including greater flexibility in determining eligibility, raising loan limits, and emphasizing beginning and socially disadvantaged producers.


Changes that will take effect immediately include:


• Elimination of loan term limits for guaranteed operating loans.


• Modification of the definition of beginning farmer, using the average farm size for the county as a qualifier instead of the median farm size.


• Modification of the Joint Financing Direct Farm Ownership Interest Rate to 2 percent less than regular Direct Farm Ownership rate, with a floor of 2.5 percent. Previously, the rate was established at 5 percent.


• Increase of the maximum loan amount for Direct Farm Ownership down payments from $225,000 to $300,000.


• Elimination of rural residency requirement for Youth Loans, allowing urban youth to benefit.


• Debt forgiveness on Youth Loans, which will not prevent borrowers from obtaining additional loans from the federal government.


• Increase of the guarantee amount on Conservation Loans from 75 to 80 percent and 90 percent for socially disadvantaged borrowers and beginning farmers.


• Microloans will not count toward loan term limits for veterans and beginning farmers.


Additional modifications must be implemented through the rulemaking processes. Visit the FSA Farm Bill website at www.fsa.usda.gov/farmbill for detailed information and updates to farm loan programs.


Youth Loans


The Farm Service Agency makes loans to youths to establish and operate income-producing projects in connection with 4-H clubs, FFA and other agricultural groups. Projects must be planned and operated with the help of the organization advisor, produce sufficient income to repay the loan and provide the youth with practical business and educational experience. The maximum loan amount is $5000.


• Be a citizen of the United States or a legal resident alien


• Be 10 years to 20 years of age


• Must obtain a written recommendation and consent from a parent or guardian if the applicant has not reached the age of majority under state law


• Comply with FSA’s general eligibility requirements


• Conduct a modest income-producing project in a supervised program of work as outlined above


• Demonstrate capability of planning, managing and operating the project under guidance and assistance from a project advisor. The project supervisor must recommend the project and the loan, along with providing adequate supervision.


To find out more about the FSA’s Youth loan program, contact Farm Loan Officer Mark Arnold at 740-392-0801 to setup an appointment. You may also want to view the youth loan fact sheet at http://www.fsa.usda.gov/Internet/FSA_File/loanyouth2014.pdf


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