Farm Loans

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UNITED STATES DEPARTMENT OF AGRICULTURE

FARM SERVICE AGENCY FACT SHEET March 2016

Shared Appreciation Agreements

OVERVIEW

Farm Service Agency (FSA) farm loan borrowers 

who own real estate, apply for loan servicing and 

qualify to have real estate debt written down must 

sign a shared appreciation agreement (SAA).

The SAA allows the Government to recapture all 

or a portion of the amount written down if the real 

estate security increases in value during the term of 

the SAA. Recapture cannot exceed the amount of 

the write-down. Recapture is calculated as of the 

expiration date of the SAA, or sooner if one of the 

following occurs:

• the property is sold or conveyed, with the 

exception of transferring title to the spouse 

upon the death of a borrower;

• the FSA loans are repaid;

• the borrower ceases farming; or

• the account is accelerated.

Recapture due under the SAA is 75 percent of the 

appreciation when one of the above events occurs 

within 4 years of receiving the write-down, and 

50 percent of the appreciation after 4 years. If the 

amount of write-down is less than the appreciation 

calculated, the amount due is the write-down 

amount.

APPRAISALS

Appreciation of the property’s value is determined 

by appraisal, with deductions for certain capital 

improvements made during the term of the 

agreement. The borrower may appeal the Agency 

appraisal by obtaining a technical appraisal review 

of the Agency’s appraisal. The issue of the appeal 

will be the compliance of the Agency appraisal 

with the Uniform Standards of Professional 

Appraisal Practice. Once appreciation has been 

calculated, the borrower is required to pay the 

amount of recapture due.

IF A BORROWER CANNOT PAY THE 

RECAPTURE AMOUNT

In some instances, borrowers will be unable to pay 

the recapture amount or obtain financing to do so. 

In such cases, provided that the borrower can show 

a positive cash flow and meet other regulatory 

requirements, the recapture amount can be repaid 

over a period of up to 25 years at a special low 

interest rate.

FOR MORE INFORMATION

For more information about FSA and its programs, 

visit your local FSA office or online at 

www.fsa.usda.gov. 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.