According to staff reports
MIFFLINTOWN — The Federal Agricultural Services Agency has funding set aside specifically for use by targeted underserved groups and beginning farmers, designed to help farmers buy and operate family farms, Robert E Zeigler Jr. of the USDA’s FSA office which covers Mifflin, Juniata, Perryt and Dauphin counties, the growers are reminded today.
“With these loan programs, the FSA hopes to help reverse the declining number of farmers and ranchers in the United States and especially here,” said Zeigler. “These loans encourage and help them own and operate their own farms and ranches, participate in agricultural programs, and become an integral part of the farming community.”
Zeigler said the FSA sets aside a portion of its loan funds each year for targeted underserved groups, which the USDA defines as a group whose members have been subjected to racial, ethnic or gender bias because of their identity. as members of the group without regard to their individual qualities. . For the purposes of this program, the targeted underserved groups are women, African Americans, American Indians and Alaska Natives, Hispanics, Asians, and Pacific Islanders.
Direct loans are made to applicants by the FSA and include both operating and farm ownership loans. Repayment terms for direct operating loans depend on the collateral backing the loan and generally range from one to seven years. Zeigler said repayment terms for direct ownership loans can be up to 40 years.
Interest rates for direct loans are set periodically based on the government’s cost of borrowing. The down payment loan program requires the applicant to provide a minimum down payment of 5% in cash, then the loan cannot exceed 45% of the lesser of the purchase price, of the appraised value of the farm to be acquired or $667,000 and for a term not to exceed 20 years.
Down payment loans provided in the form of micro-loans for farm property purposes cannot exceed $50,000.
Farm property loan funds can be used to purchase or expand a farm, purchase easements or rights of way necessary to operate the farm, erect or improve buildings such as a dwelling or barn, promote soil and water conservation and development, or pay closing costs.
Farm business loan funds can be used to purchase livestock, poultry, farm and household equipment, feed, seeds, fuel, fertilizers, chemicals, refinance related debts to farming other than real estate, hail insurance and other crops, food, clothing, medical care and hired labor. Funds can also be used to install or improve water systems for domestic use, for livestock or irrigation and other improvements.
Individuals, partnerships, joint ventures, corporations and cooperatives primarily and directly engaged in agriculture and animal husbandry on family farms may apply. A family-sized farm is considered a farm that a family can operate and manage on their own.
Secured loans may also be made for ownership or operating purposes, and may be made by any lending institution subject to federal or state supervision. Typically, the FSA guarantees 90 or 95% of a loan against any loss that might be incurred if the loan fails. The terms of the secured loan are set by the lender. Interest rates for secured loans are set by the lender.
Applicants must meet the eligibility criteria for a given program before the FSA can extend program benefits. For more information or for applications for all FSA direct lending programs, contact the local FSA office at 146 Stoney Creek Drive Suite 1, Mifflintown, or call (717) 436-4003.