USDA farm loans (Farm Service Agency)

The Farm Service Agency (FSA), part of USDA, lends to family farms in two ways. You apply at your local FSA office for a direct loan, or to a bank, Farm Credit lender or other approved lender for a guaranteed loan, and the lender asks FSA for the guarantee.

• Farm ownership loans: to buy or enlarge a farm, make a down payment, put up or improve buildings, and pay for soil and water conservation. Direct loans up to $600,000, for up to 40 years.
• Farm operating loans: for livestock, equipment, feed, seed, fertilizer, fuel, insurance, cash rent, family living costs, minor repairs and some refinancing. Direct loans up to $400,000. A loan for a year's costs is repaid when that year's income comes in; other operating loans run for up to 7 years.
• Microloans: direct operating or ownership loans of $50,000 or less, with a shorter application. Made for small, new and niche farms.
• Down payment loans: for beginning farmers and veterans buying a farm. You put in at least 5% of the price, FSA lends up to 45% of it (counting at most $667,000 of the price) for up to 20 years, and a bank or the seller lends the rest.
• Guaranteed loans: the lender makes the loan and FSA guarantees up to 90% of any loss, or 95% for beginning farmers and some others. Ownership and operating loans up to $2,558,000 in total, adjusted each year. Operating lines of credit can be drawn for up to 5 years.

Rates. FSA sets the direct loan rates each month. For October 2026: operating loans and microloans 5.375%, ownership loans 6.25%, down payment loans 2.25%. An operating microloan to a beginning farmer or a veteran is at most 5%. A lower rate is open to farmers who cannot make their plan work at the regular one. On a guaranteed loan you agree the rate with the lender, and FSA caps it.

Who can borrow. You must run a family farm once the loan closes: the family makes the decisions and does a large part of the work, and hired workers only add to it. You, and anyone who signs the loan, must be a US citizen, a US non-citizen national or a qualified alien (such as a green card holder); for a guaranteed loan to a business entity, more than half of it must be owned by such people. You need farm experience, training or education, an acceptable record of repaying debts, and no overdue federal debt. For a direct loan you must show you cannot get enough credit elsewhere at reasonable rates and terms, including a guaranteed loan; for a guaranteed loan, that the lender would not lend without the guarantee.

Timing. FSA decides on a complete direct loan application within 60 days and gives its reasons if it says no. Direct loans come from yearly funds from Congress: if they run out, an approved application waits until there is more. FSA answers a lender's complete guarantee request within 30 days, or 14 days for its certified and preferred lenders. Since October 1, 2026, some direct loan applicants with strong finances and repayment records go through a faster review, Application Fast Track.