End Rows for June 7, 2011
Each year, the Farm Service Agency earmarks a portion of its farm loan funding for socially disadvantaged applicants, which USDA defines as people who have been subjected to racial, ethnic or gender inequality without regard to their individual qualities
Socially disadvantaged applicants may be women, African Americans, American Indians, Hispanics, Asian and Pacific Islanders and Alaskan Natives.
While funding is earmarked for loans to socially disadvantaged applicants, loan approval is neither automatic nor guaranteed.
Socially disadvantaged applicants must meet the same eligibility criteria as other applicants.
Applicants must be U.S citizens; have a satisfactory history of meeting credit obligations; have sufficient education, training or experience managing or operating a farm; possess legal capacity to incur debt; and be unable to obtain credit elsewhere.
The agency can make direct loans to applicants who are unable to get commercial credit or provide loan guarantees to commercial lenders.
Guaranteed loans may be made by any lending institution subject to Federal or state supervision (banks, savings and loans, and units of the Farm Credit System).
FSA typically guarantees 90 or 95 percent of the loan against any loss that might be incurred if the loan fails.
Applicants can use operating loans to purchase livestock, equipment, feed, seed or pay other business related expenses.
Operating loans are usually repaid in one to seven years.
Ownership loans provide capital to purchase or enlarge a farm, construct or improve buildings; promote soil and water conservation and pay closing costs.
Direct ownership loan terms are up to 40 years while guaranteed loan amortization is established by the lender.
It is not too late
to sign 2011 DCP/ACRE
Even though the June 1 deadline has passed, producers can still sign their 2011 Direct and Counter-cyclical Program and Average Crop Revenue Election contracts.
Instead of being subject to a $100 late-filing fee as in the past, DCP and ACRE contracts filed after June 1 through August 1 will have to go before the County Committee for approval.
Contracts signed August 2 through September 30 will be sent to the state office with a request for relief based on an explanation from the producer(s) why the contract was not filed timely.
If filed by August 31, it is up to the State Committee to approve the contract.
The State Committee will have to forward all DCP and ACRE contracts filed September 1 through September 30 to Washington DC for approval.
These deadlines do not apply to ACRE election. June 1 was the absolute last day to file the Average Crop Revenue Election form for 2011.
Again, if you missed the June 1 deadline, come in before August 1 to enroll for 2011. Because contracts filed after August 1 will have to go the State Committee, and subsequently to the National office, it's recommended participants enroll by August 1.
As always, if you have any questions, contact your local FSA office.