Farm Loans

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UNITED STATES DEPARTMENT OF AGRICULTURE

FARM SERVICE AGENCY FACT SHEET

November 2016

Farm Loan Program Funding

OVERVIEW

The U.S. Department of Agriculture (USDA) Farm 

Service Agency (FSA) makes and guarantees loans 

to family farmers to purchase farmland and finance 

agricultural production. Farmers may apply for 

direct loans at local FSA offices. Guaranteed loans 

are available from local commercial lenders who 

apply for loan guarantees from FSA. All programs 

are administered through local FSA county offices.

FUNDING SOURCE

Each year, the U.S. Congress appropriates funds 

for FSA farm loans as part of the USDA budget. 

The funds generally are appropriated for the 

government’s fiscal year, which runs from Oct. 1 

through Sept. 30 of the following year. The amount 

of funds appropriated does not always meet the 

demand for loans and occasionally the funds are 

depleted before the end of the federal fiscal year.

Congress may pass a supplemental appropriations 

bill to make additional funds available. If Congress 

does not appropriate additional funds, loans cannot 

be funded until the next fiscal year when new 

appropriations become available.

STATE ALLOCATIONS

Upon enactment of full fiscal year appropriation, 

every state receives an allocation of funds from 

the agency. It is possible for one state to deplete its 

funds while other states are still funding loans.

The agency allocates loan funds to states based 

on the potential need. This is determined by the 

number of farmers in each state, the value of farm 

assets and net farm income. The largest factor is 

the number of farmers in each state.

FSA does not allocate funds for emergency loans 

to states because of the difficulty in predicting 

the occurrence of natural disasters or federal

quarantines. Instead, FSA makes the funds 

available for these loans when a natural disaster or 

quarantine is declared. Emergency loan funds are 

available on a first-come, first-served basis.

When loan funds are near depletion in a state, FSA 

periodically will combine unused loan funds into 

a national office account. Should sufficient funds 

remain, it will be redistributed to the states.

If funds have neared depletion, the funds will be 

held at the national office and states can request 

funding on a loan-by-loan basis. Combining 

unused loan funds happens most commonly in the 

spring.

RESERVED LOAN FUNDS

FSA reserves loan funds for targeted underserved 

producers. The law requires FSA to reserve 

or target a portion of its direct and guaranteed 

operating and farm ownership loan funds for use 

exclusively by underserved groups whose members 

include American Indians or Alaskan Natives, 

Asians, Blacks or African-Americans, Native 

Hawaiians or other Pacific Islanders, Hispanics, 

women and new farmers.

Targeted funding for underserved groups whose 

members have been subjected to racial, ethnic or 

gender prejudice is based upon census data.

Funds are reserved for exclusive use by new 

farmers as follows: Direct Operating, 50 percent; 

Guaranteed Operating, 40 percent; Direct Farm 

Ownership, 75 percent; and Guaranteed Farm 

Ownership, 40 percent. Funds remain targeted for 

beginning farmers in the guaranteed programs until 

April 1 of each fiscal year. In the direct programs, 

funds are targeted for beginning farmers until 

Sept. 1 of each fiscal year.
FACT SHEET

Farm Loan Program Funding November 2016

APPLYING FOR A LOAN WHEN 

PROGRAM FUNDS ARE DEPLETED

Farmers may apply for a loan even when funds 

have been depleted for a loan program. In this 

case, FSA still accepts, processes and approves 

loan applications, subject to funding. Approved 

applications are placed on a waiting list and 

then funded based on the date the application 

was received in the FSA office, so applicants are 

encouraged to apply for a loan even when there 

are no funds available. Applicants who have been 

approved can contact their local FSA office to 

determine if funds are available for the loan.

FOR MORE INFORMATION

This fact sheet is provided for informational 

purposes only; other details or restrictions may 

apply. For further information, visit 

www.fsa.usda.gov/farmloans or contact your 

local FSA office. To find your local FSA office, 

visit http://offices.usda.gov. ___________________________________________

In accordance with Federal civil rights law and U.S. Department of 

Agriculture (USDA) civil rights regulations and policies, the USDA, 

its Agencies, offices, and employees, and institutions participating in 

or administering USDA programs are prohibited from discriminating 

based on race, color, national origin, religion, sex, gender identity (including gender expression), sexual orientation, disability, age, marital 

status, family/parental status, income derived from a public assistance 

program, political beliefs, or reprisal or retaliation for prior civil 

rights activity, in any program or activity conducted or funded by 

USDA (not all bases apply to all programs). Remedies and complaint 

filing deadlines vary by program or incident.

Persons with disabilities who require alternative means of communication for program information (e.g., Braille, large print, audiotape, 

American Sign Language, etc.) should contact the responsible Agency 

or USDA’s TARGET Center at (202) 720-2600 (voice and TTY) or 

contact USDA through the Federal Relay Service at (800) 877-8339. 

Additionally, program information may be made available in languages other than English.

To file a program discrimination complaint, complete the USDA 

Program Discrimination Complaint Form, AD-3027, found online at 

http://www.ascr.usda.gov/complaint_filing_cust.html and at any USDA 

office or write a letter addressed to USDA and provide in the letter 

all of the information requested in the form. To request a copy of the 

complaint form, call (866) 632-9992. Submit your completed form or 

letter to USDA by:

1) mail: U.S. Department of Agriculture Office of the Assistant

 Secretary for Civil Rights 1400 Independence Avenue, SW

 Washington, D.C. 20250-9410;

2) fax: (202) 690-7442; or

3) email: program.intake@usda.gov.

USDA is an equal opportunity provider, employer, and lender.

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