The USDA Increases Borrowing Limits for Certain Loan Programs
The USDA is increasing the borrowing limit for certain farm loans. The 2018 Farm Bill has increased the amount that producers can borrow from loans available through the USDA’s Farm Service Agencies.
The Direct Operating Loan, which helps producers pay for normal operating expenses, has had its limit increased from $300,000 to $400,000, and the Guaranteed Operating Loan limit has been increased from $ 1.4 million to $1.75 million.
Notable changes have also been made to loan programs like microloans and emergency loans. For instance, Producers can now receive both a $50,000 Farm Ownership Microloan and a $50,000 Operating Microloan.
Producers who previously received debt forgiveness as part of an approved FSA restructuring plan are now eligible to apply for emergency loans, wheres previously they were ineligible.
Other USDA changes include higher levels of coverage offered through the Non-insured Crop Disaster Assistance Program (NAP). Service fees for the program have been increased, but service fee waivers have been added for qualified military veterans.
The 2018 Farm Bill reinstates higher levels of coverage for the NAP program from 50 to 65 percent of expected production in 5 percent increments, at 100 percent of the average market price.
Producers will have a one-time opportunity that expires after May 24th to obtain buy-up coverage for 2019 or 2020 eligible crops for which the NAP application closing date has passed.
To find out more about all the new changes, visit the USDA website or Farmers.gov.