USDA Farm Service Agency farm loan chief Stuart Shelstad announced that guaranteed farm ownership loan funds for Fiscal Year 2012 have been exhausted.
Farmers and ranchers in Minnesota received $68,419,302 in guaranteed farm ownership loans this fiscal year.
"Fiscal Year 2013 begins on October 1, 2012, and we anticipate that guaranteed farm ownership funds will be available in early October," said Shelstad.
Farm ownership loans may be used to help purchase or expand a farm or ranch, construct a new or improve an existing farm or ranch building, pay closing costs, and pay for soil and water conservation and protection.
Increased FSA Guaranteed Loan Limits begin Oct. 1
FSA guaranteed loans allow lenders to provide agricultural credit to farmers who do not meet the lender's normal underwriting criteria. Farmers and ranchers apply for a guaranteed loan through a commercial lender, and the lender arranges for the guarantee. FSA can guarantee up to 95% of the loss of principal and interest on a loan. Guaranteed loans can be used for both farm ownership and operating purposes. Operating loans may be used to purchase livestock and equipment, pay for minor real estate repairs and annual operating expenses.
According to Shelstad, the guaranteed loan limit will increase to $1,302,000 starting on October 1, 2012.
"FSA is committed to providing credit through guaranteed and direct loans to eligible farmers and ranchers who need capital to continue or start their agricultural operation," he said.
To qualify for an FSA loan, a farmer must write a detailed business plan that describes:
• the mission, vision, and goals for the farm or ranch
• current assets (property or investments owned) and liabilities (debts, loans, or payments you owed)
• what the operation will produce, and how and where products will be marketed and sold (marketing plan)
• whether the amount of income generated will be enough to pay business and family living expenses.
For more information regarding IRS reporting changes, producers are encouraged to contact their local FSA service center or visit FSA's website at http://www.fsa.usda.gov/.
Source: Minnesota FSA