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Emergency Farm Loans

When a tornado, flood, or dry spell strikes, or a quarantine is imposed by the Secretary of Agriculture, or when other natural catastrophes occur, FSA's Emergency loan program exists to assist qualified farmers and ranchers reconstruct and recuperate from continual losses.

The Emergency loan program is triggered when a natural disaster is designated by the Secretary of Agriculture or a natural disaster or emergency situation is stated by the President under the Stafford Act. These loans assist producers who suffer qualifying farm related losses directly triggered by the disaster in a county stated or designated as a primary catastrophe or quarantine location. Also, farmers located in counties that are contiguous to the stated, designated, or quarantined location might get approved 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 need the very same basic kinds. Emergency loan demands have 2 additional types, the accreditation of catastrophe losses and lending institution verification that commercial banking assistance was rejected.

When you consult with your FSA county Farm Loan Program personnel, you might be asked to complete extra types based upon suitable loan program requirements for the loan type.

Emergency Loans Frequently Asked Questions

Loan Purposes

Emergency loan funds may be utilized to:

- Restore or replace necessary residential or commercial property.
- Pay all or part of production costs associated with the catastrophe year.
- Pay essential household living expenses.
- Reorganize the household farming operation.
- Refinance certain non-real estate operating financial obligations.
Eligibility Requirements

For production losses, a disaster year yield that is listed below the normal production yield of the crop, as figured out by the Agency, is needed. Losses to quality, such as getting a lowered rate for flood harmed crops, might also be qualified for help.

In addition to the basic eligibility requirements all loan applicants must fulfill, there are some additional criteria distinct to the Emergency Loan program:

- the loan candidate should be a recognized farmer and either the owner-operator or of the farm at the time of the catastrophe.
- loan candidates must mean to continue farming.
- loan applicants should get written declinations of credit from arranged industrial loan provider- If the loan is higher than $100,000 and less than $300,000, only 1 letter is needed.
- If the loan is greater than $300,000, 2 letters of declination are required.
- If the loan quantity 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 amount for an Emergency loan is $500,000 yet the quantity a loan candidate might receive is limited to the actual quantity of production or physical loss triggered by the disaster. Physical loss loans are based upon the amount needed to replace the lost residential or commercial property, such as stored grain, devices and livestock.

Repayment Terms

Repayment terms are based on the beneficial life of the security, a loan candidate's repayment ability, and the type of loss involved. The repayment schedule will need at least 1 payment every year. Emergency loans for yearly business expenses should be repaid within 12 months, and not to surpass 18 months if an extended term is required for the production cycle of the farming product.

Rates of interest

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

Additional Information

We encourage 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 should be able to find a listing in the telephone directory in the area set aside for governmental/public organizations under the U.S. Department of Agriculture, Farm Service Agency. Our regional FSA offices enjoy to help you.