FSA Loans for Socially Disadvantaged Farmers and Ranchers

FSA loans are made available to a group of farmers, ranchers, and agricultural producers considered as socially disadvantaged (SDA) individuals. This class of people are women, Hispanics, Alaskan Natives, American Indians, African American, Asian Americans, and Pacific Islanders.

Direct Farm Ownership Loans

One of the FSA loans provided to SDA members is the direct farm ownership (FO) loan. The loan is funded by commercial lending institutions like banks and credit unions. The agency guarantees the lenders 90% of the loan. Funds accumulated from this loan program can be used to purchase a land or ranch. Other farming expenses this loan offers are financial assistance for buildng improvement, enlargement of agricultural production, debt refinancing, and closing costs.

Farm Operating Loans

The farm operating loans (OL) is another agricultural loan offered to SDA farmers and ranchers guaranteed by the FSA. The funds acquired from this rural loan is targeted for farm operation expenses. It can be utilized to buy farming equipment, fertilizers, seeds, feeds, poultry and livestock. Like FO, OP can also be used by the borrower to modify or refinance his debt and pay loan closing costs.