Direct Ownership FSA Loans

If you are a farmer, or rancher, who has been wanting to purchase farmland, but do not have the required capital, the Direct Ownership fund offered by the arm Agency Service (FSA) under its FSA loan programs could be the answer to your needs. Review this vital information to see whether you qualify for this loan or not.

Eligibility Requirements of the Agricultural Loans

To obtain the direct farm ownership (FO) FSA loans, you must meet certain criteria that the agency requires. You must:

  • be a citizen or a permanent resident of the United States
  • have been denied by private lending institutions to borrow a capital
  • be a responsible borrower that does not have defaulted federal or private loans
  • demonstrate an acceptable credit history
  • present a feasible farming/ranching plan
  • be engaged in the agricultural business and have operated a "family-sized farm"  for at least 3 to 10 years
  • have sufficient farming knowledge, skills, and training
  • established your repayment capability together with a collateral to secure the loan

Loan Program's Amount and Financing Plans

The FSA sets a maximum budget of $300,000 for each applicant that qualifies the FSA loans. Interest rates depend on various factors which include the type of collateral and the borrower's repayment capability. Rates are also adjusted periodically, based on the federal government's cost of borrowing. Borrowers may also wish to apply the loan through a "joint financing plan" wherein 50% of the capital will be financed by the government and the other 50% will be produced by another lender. This type of plan has an interest rate of not less than 4%.