Farm Loans And Programs For Those New To Farming
Farm loans, stock, inventory, crop management
, and crop insurance may all be new words to you if you are just starting out in farming. Don't worry though; every farmer had to start somewhere.
For those farmers that are just starting out, there are many resources out there today that can help you get started. You can qualify for special loan programs through the USDA and possibly many other benefits through your financing company.
FSA Beginner Farm Loans
The Farm Service Agency (FSA) of the U. S. Department of Agriculture makes it possible for farmers that are just starting out, or haven't been in the business very long, to obtain farm loans. The FSA makes sure that it sets aside a certain portion of its operating loan funds, as well as its direct and guaranteed farm ownership funds, to be provided to new farmers.
In order for a farmer to qualify as a beginning farmer, they have to meet the following criteria:
-The farm they own is 30% or less in size compared to the average sized farm in the county.
-The applicant has to meet all the loan eligibility requirements for the specific farm loan they are applying for.
-The loan applicant has to be significantly involved in the day-to-day operation of the farm.
-The person applying for the loan cannot have operated a farm for more than 10 years.
To see if you quality for these beginner farm loans, contact your local USDA office. You can also contact your financing company to see if they are a participating lender in this program.
Farm Loan Benefits for New Farmers
Many finance companies offer special benefits to new farmers that know little or nothing about farming. These programs help the new farmers get started down the right path, or redirected to where they need to be if they are not quite doing it right. It also helps them learn about their business; and how to think smartly about the good and the bad that may come up in the future.
These benefits for new farmers do vary from one financing company to another. However, to give an example of what some of the financing companies are doing, take the new farmer benefits at Farm Credit Services of Mid-America. This financing company offers its new farmers special underwriting programs for farm loans that are specifically tailored to new farmers. They also waive their origination fee and reimburse part of the FSA guarantee fee.
In addition, they pay for continuing education programs and investment programs for their new farmers.
Farm Loan Education for Beginning Farmers
Education is essential whenever you are starting out something new. Many farm loan companies hold this same philosophy; which is why they encourage their new farmers to get involved with farm education programs. Some lenders even go so far as paying for these educating seminars and classes.
Why would a farm loan financing company pay to educate new farmers? Contrary to popular belief, farm loan companies want to see their farmers succeed. By educating new farmers, they learn how to run their farms better. Making it a win-win situation for both the farmer and the farm loan company.
Copyright (c) 2012 Farm Credit Services of Mid-America
by: Darren Lynn
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