Higher
Loan Limit Now Available for USDA Guaranteed Farm Loans
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[October 13, 2021]
The U.S. Department of Agriculture
(USDA) announced a higher loan limit will be available for borrowers
seeking a guaranteed farm loan starting October 1, 2021, from $1.776
million to $1.825 million.
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FSA farm loans offer access to funding for a wide range of
producer needs, from securing land to financing the purchase of
equipment. Guaranteed loans are financed and serviced by
commercial lenders. FSA provides up to a 95% guarantee against
possible financial loss of principal and interest. Guaranteed
loans can be used for both farm ownership and operating
purposes.
In fiscal year 2021, FSA saw continued strong demand for
guaranteed loans. FSA obligated more than $3.4 billion in
guaranteed farm ownership and operating loans. This includes
nearly $1.2 billion for beginning farmers. The number of
guaranteed borrowers has grown by 10% to more than 38,750
farmers and ranchers over the last decade. Illinois FSA
currently has 3600 guaranteed loans with 3100 customers, with an
outstanding balance of $1.18 billion. FSA expects the increasing
demand for farm loans to continue into fiscal year 2022.
Disaster Set-Aside Extension
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USDA has additional support available to producers given the
recent outbreaks of the COVID-19 Delta variant and has extended
the availability of COVID-19 Disaster Set-Aside (DSA) for
installments due through January 31, 2022. In addition, FSA will
permit a second DSA for COVID-19 and a second DSA for natural
disasters for those who had an initial COVID-19 DSA. Requests
for a COVID-19 DSA or a second DSA must be received no later
than May 1, 2022.
Last year, FSA broadened the use of the DSA. Normally used in
the wake of natural disasters, the DSA can now allow farmers
with USDA farm loans who are affected by COVID-19 and determined
to be eligible, to have their next payment set aside. The
set-aside payment’s due date is moved to the final maturity date
of the loan or extended up to twelve months in the case of an
annual operating loan. Any principal set-aside will continue to
accrue interest until it is repaid. This will improve the
borrower’s cashflow in the current production cycle.
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More Information
Producers can explore available options on all FSA loan options at fsa.usda.gov or
by contacting their local USDA Service Center. Service Center staff
continue to work with agricultural producers via phone, email, and
other digital tools. Because of the pandemic, some USDA Service
Centers are open to limited visitors. Contact your Service Center to
set up an in-person or phone appointment. Additionally, more
information related to USDA’s response and relief for producers can
be found at farmers.gov/coronavirus.
USDA touches the lives of all Americans each day in so many positive
ways. In the Biden-Harris Administration, USDA is transforming
America’s food system with a greater focus on more resilient local
and regional food production, fairer markets for all producers,
ensuring access to healthy and nutritious food in all communities,
building new markets and streams of income for farmers and producers
using climate smart food and forestry practices, making historic
investments in infrastructure and clean energy capabilities in rural
America, and committing to equity across the Department by removing
systemic barriers and building a workforce more representative of
America. To learn more, visit www.usda.gov.
[Farmers.gov]
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