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About RIC | Rural Resources | Funding Resources | What Is Rural? | FAQs | Conferences | Publications | Search RIC | Ask A Question |  |
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About RIC | Rural Resources | Funding Resources | What Is Rural? | FAQs | Conferences | Publications | Search RIC | Ask A Question | |
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Start your financial assistance search with your state Agriculture Department to see if your state has a Beginning Farmer program. Beginning Farmer programs or "Aggie Bonds" are one form of industrial development bonds that have been provided tax-exempt status by the federal government. Your state Department of Agriculture can provide useful information about state specific programs:
Information on the major lenders of agricultural credit can be found on the USDA, Economic Research Service (ERS) Lenders and Financial Markets briefing room. This web site discusses the difference between the major lenders. Additional information on agricultural lending is provided below.
Commercial Banks: From the USDA's Economic Research Service, "banks as a group are important lenders to all segments of the farm economy. They make loans to small and large farms, to agribusiness firms, and for both farmland and production purposes. Commercial banks also handle many of the loans made under USDA's guaranteed farm loan programs."
According to the 2003 American Bankers Association (ABA) Farm Credit Survey Report for 2003, "most farms served by banks are small family farms with less than $250,000 in annual sales." For more information on this report see the web site below.
The USDA is focused on assisting those in agriculture. The USDA's Farm Services Agency (FSA), formerly the Farmer's Home Administration, is the agency within USDA that provides the majority of farm lending. FSA has a variety of farm loan programs, including traditional operatng loans, beginning farmer and youth programs. FSA also includes a mediation program for agricultural disputes. For more information on FSA and additional USDA programs that assist farms:
Additional USDA Farm Programs
The Farm Credit Service (FCS) is a collection of federally chartered borrower-owned credit cooperatives that lend primarliy to agriculture, but also provide rural home loans. The FCS also has a young, beginning and small farmer lending requirement by Congress. For a description of the FCS and a list of banks serving your state:
The Federal Agricultural Mortgage Corporation or Farmer Mac is the "federally chartered corporation created by Congress to establish a secondary market for agricultural real estate and rural housing mortgages and loans, and to facilitate capital market funding for U.S. Department of Agriculture (USDA) guaranteed farm program and rural development loans." 1-800-TRY-FARM.
The Federal Home Loan Bank System (FHLBS) is a government sponsored enterprise that lends to other member financial institutions. The FHLBS financing includes rural development and agricultural lending to small banks. The FHLBS does not provide direct loans to individuals.
