Having access to credit as a beginning farmer is an issue that can make or break one’s business planning on their operation. Over the last few years the USDA Farm Service Agency (FSA) has really been making an effort to provide valuable information and resources to people from all walks of life interested in farming.
And agriculture groups are helping get the information in their farmer’s hands. At the Prairie Grains Conference Dec. 10-11, there was even a session for beginning farmers to learn about the loans available to them and what is required.
USDA FSA Farm Loan Manager Dane Ryden spoke to a room full of beginning farmers and young people considering starting their own farm operation during a break-out session at the conference. After discussing some of the key loans to apply for and their requirements, Ryden gave potential loan-seekers some tips.
“Come in to the FSA office or call an FSA loan manager before dropping an application off so you can discuss your options and have a better idea of what to apply for,” Ryden said. “There are many times people drop off applications without talking to someone, and we can’t okay their request because they are missing something.”
Ryden repeated several times that when considering a beginning farmer’s application for a loan, the FSA will take the level of management experience an applicant has had on the farm into consideration.
“In the eyes of the FSA, if all you’ve done is drive tractor, they will see you as not having management farm experience but more like hired labor,” Ryden said.
But that’s not all. The following are more tips Ryden gave for seeking a beginning farmer loan at your FSA office:
- Be prepared to discuss specifics. Have an outline of what you want to accomplish.
- The applicant should be the person asking the questions. Often times Father or Mother come along and ask most of the questions, which makes it unclear who will actually be managing the loan.
- Put more effort into the managerial section of your application as this will heighten your chances for your response.
- The FSA will track how you use the funds, where things are spent and how the money could be best spent. If you don’t want that level of supervision, an FSA beginning farmer loan is not your best option.
- If you’ve never taken a loan out with FSA, starting small with microloans is a great way to get started.
Ryden also says that successful youth and microloans generally lead to successfully managed operating and larger loans. He encourages beginning farmers to start small and learn how to manage a loan successfully for the future of their operation.
For more resources, go the FSA website or stop in at your local FSA office.