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Emergency Farm Loans

When a tornado, flood, or drought strikes, or a quarantine is enforced by the Secretary of Agriculture, or when other natural disasters occur, FSA's Emergency loan program exists to assist qualified farmers and ranchers restore and recover from sustained losses.

The Emergency loan program is triggered when a natural disaster is designated by the Secretary of Agriculture or a natural catastrophe or emergency situation is stated by the President under the Stafford Act. These loans help manufacturers who suffer qualifying farm related losses directly brought on by the catastrophe in a county declared or designated as a main disaster or quarantine area. Also, farmers located in counties that are adjoining to the stated, designated, or quarantined location might certify for Emergency loans.

Resources

Fact Sheet: Emergency Loan Program (PDF, 1.7 MB).
Fact Sheet: Emergency Disaster and Declaration Process (PDF, 631KB).
Other FSA Disaster Assistance Programs.
USDA Disaster Resource Center.
Direct Loan Making Handbook 3-FLP (PDF, 2.5 MB).
Access to FEMA Disaster Help and Resources.
Farmers.gov.
Application

Download and complete the Emergency Loan Applications and Instructions:

All FSA direct loan applications require the exact same basic forms. Emergency loan requests have 2 extra forms, the accreditation of catastrophe losses and lender verification that business banking assistance was rejected.

When you meet your FSA county Farm Loan Program personnel, you may be asked to finish extra forms based on applicable loan program requirements for the loan type.

Emergency Loans Frequently Asked Questions

Loan Purposes

Emergency loan funds might be used to:

- Restore or change important residential or commercial property.
- Pay all or part of production expenses related to the disaster year.
- Pay essential family living expenses.
- Reorganize the family farming operation.
- Refinance particular non-real estate operating debts.
Eligibility Requirements

For production losses, a disaster year yield that is listed below the typical production yield of the crop, as identified by the Agency, is needed. Losses to quality, such as receiving a lowered cost for flood damaged crops, might likewise be eligible for help.

In addition to the basic eligibility requirements all loan candidates must meet, there are some extra criteria unique to the Emergency Loan program:

- the loan candidate need to be an established farmer and either the owner-operator or tenant-operator of the farm at the time of the catastrophe.
- loan applicants should plan to continue farming.
- loan applicants should get composed declinations of credit from organized commercial loan provider- If the loan is greater than $100,000 and less than $300,000, just 1 letter is required.
- If the loan is higher than $300,000, 2 letters of declination are required.
- If the loan amount requested is $100,000 or less, this requirement is determined on a case by case basis at the Agency's discretion.

Maximum Loan Limitations

The optimum loan for an Emergency situation loan is $500,000 yet the amount a loan candidate may get is limited to the actual amount of production or physical loss triggered by the catastrophe. Physical loss loans are based on the quantity required to replace the lost residential or commercial property, such as stored grain, equipment and animals.

Repayment Terms

Repayment terms are based upon the beneficial life of the security, a loan applicant's payment capability, and the type of loss included. The repayment schedule will need a minimum of 1 payment every year. Emergency loans for yearly operating costs should be paid back within 12 months, and not to exceed 18 months if an extended term is essential for the production cycle of the agricultural commodity.

Rate of interest

Interest rates are determined and posted the 1st of every month. The interest rate charged is always the lower rate in result at the time of loan approval or loan closing for the type of loan desired.

Additional Information

We motivate you to call your local office or USDA Service Center to find out more about our programs and the info you will need for a complete application. You likewise must have the ability to discover a listing in the phone book in the area reserve for governmental/public companies under the U.S. Department of Agriculture, Farm Service Agency. Our regional FSA offices more than happy to help you.