USDA last week announced changes to the Farm Service Agency (FSA) farm loan programs that should help producers secure larger loans or defer payments when hit by disasters. The improvements are part of the enhancing program access and delivery for farm loans rule that will go into effect for FSA loans after September 25.
According to USDA, the policy changes are designed to better assist borrowers in making strategic investments in the enhancement or expansion of their agricultural operations. The most notable updates include establishing a new low-interest installment set-aside program for financially distressed borrowers, providing all eligible loan applicants access to flexible repayment terms, and reducing additional loan security requirements to enable borrowers to leverage equity. FSA also is working to streamline the farm loan program by providing an online application, as well as a direct loan repayment feature and a loan assistance tool to help producers determine which option best fits their needs. The direct loan paper application also has been simplified by reducing the number of pages from 29 to 13.
Producers should contact their local FSA office for more information on the full set of changes made to the farm loan policy.