Funding Resources (Loans and Grants) are often crucial to starting a new farm business. This page contains comprehensive information about finding financial help for starting your farm business. It is also important to be aware that farm business planning is usually an essential component for obtaining funding, for either loans or grants for farm enterprise. We encourage you to visit our Farm Business Planning Page to learn more about how to develop a business plan.
How this Page is Organized:
1) We begin with a list of information resources about federal loan programs administered through the USDA’s Farm Service Agency (FSA).
2) Next we provide information about other federal funding options.
3) Then we list a number links to other public and private organizations which provide information about loans, grants and financial management both for farming and for research (on-farm and academic). Some are specific to beginning farmers, while others are not. And some are focused on particular geographical regions, while most are not.
5) We then provide information about the Farm Credit Cooperative system and how it may assist beginning farmers.
6) Finally, we have links to several private lenders, several of which offer loans specifically geared toward beginning farmers.
1) USDA Farm Service Agency (FSA) Loan Programs:
- Beginning Farmer and Rancher Development Loan Program Factsheet (Also see: Center for Rural Affairs: Beginning Farmer and Rancher Development Program)
- The Plain Language Guide to Applying for a Farm Service Agency (FSA) Loan published by Tufts University’s New Entry Sustainable Farming Project
2) More on Federal Financing Options
The National Sustainable Agriculture Coalition’s Guide to USDA Funding for Local and Regional Food Systems is a great resource which discusses Grants and Loans from: the Community Outreach and Assistance Partnership Program; Specialty Crop Block Grants; Farmers Market Promotion Program; Federal State Marketing Improvement Program; Beginning Farmer and Rancher Development Program (also see above); Community Food Projects Competitive Grant Program; Sustainable Agriculture Research and Education (SARE); Value Added Producer Grants; Rural Business Enterprise Grants; Rural Business Opportunity Grants; Rural Cooperative Development Grants; Community Facilities Grant Program; Small, Socially Disadvantaged Producer Grants; Business and Industry Guaranteed Loan Programs; Outreach and Assistance to Socially Disadvantaged Farmers and Ranchers; as well as Regional Resources.
The Conservation Stewardship Program, administered through the Natural Resources Conservation Service provides important funding opportunities for landowners with areas that are not in agricultural production. And a list of all Natural Resources Conservation Service programs which provide funds for a wide variety of conservation projects, initiatives, and activities, can be found at:http://www.nrcs.usda.gov/programs/
The National Sustainable Agriculture Information Service (ATTRA) provides a list of federal, state, and local grant programs, regional funding sources, private lenders and more (listed in calender form) at: http://attra.ncat.org/calendar/funding.php
The USDA National Agricultural Library has links to articles on small farm funding, finances and planning.
Find a list of USDA Rural Development Grants at http://www.rurdev.usda.gov/RD_Grants.html
GovernmentLoans.gov is a gateway to Federal agricultural loan information.
And check out the Value-Added Producer Grant (VAPG) program for group projects (farm coops, businesses, associations, etc.) in which some but not all of the beneficiaries are beginning farmers. New terms for this program were issued in the Notice of Funding Availability (NOFA) for the VAPG program.
Through the USDA’s Sustainable Agriculture Research and Education Program (SARE) farmers and ranchers can apply for grants that typically run between $500 and $15,000 for various projects. To apply, obtain a copy of a SARE call for proposals from the appropriate region and ask to be put on the regional mailing list for future calls. After you determine the deadline, submit your proposal, following all guidelines specified by the region. Remember! All deadlines are final. Please note: Each region may title its farmer/rancher grant programs differently. For more information on this programs and links to specific regions visit http://www.sare.org/coreinfo/farmers.htm. For tips on successfully applying for SARE grants visit http://www.nal.usda.gov/afsic/pubs/saregrant.shtml.
3) Other Financial Resources:
- The Center For Rural Affairs is a great resource which offers A List of Beginning Farmer Financing Programs. Also be sure to check out their Getting Started on Farm Finances Page for lots of useful tips on planning your financing strategy.
- The Ag Grant Guru has a great blog that lists funding opportunities at the federal, state and local level as well as giving tips on applying for, managing and reporting for grants.
- Check out Aggie Bonds at through the National Council of State Agricultural Finance Programs at: http://www.stateagfinance.org/directory.html
- Cooperative State Research, Extension, and Education Service offers research grants through its Beginning Farmer and Rancher Development Program
- The Center for Farm and Rural Business Finance offers an excellent publication called A Farmers Guide to Agricultural Credit which explains the lending process and what you will need to secure any kind of farm loan. It is highly recommended.
- RAFI USA also has a different publication also called A Farmer’s Guide to Agricultural Credit. This guide was written to help farmers understand agricultural finance, and to help them be better prepared for the credit application process. It introduces some effective planning tools farmers can use to increase their opportunities in accessing capital. Also offered are appendices containing resources for further learning.
- The Center for Farm Financial Management has a number of great tools, and lots of information to help farmers make sound financial decisions.
- The Rural Information Center at USDA’s National Agricultural Library has a Small Farm Funding Resources Page with lots of great information, as well as a General Funding Resources Page.
- Building Sustainable Farms, Ranches, and Communities “is a guidebook written for anyone seeking help from federal programs to foster innovative enterprises in agriculture and forestry in the United States. Specifically, the guide addresses program resources in community development; sustainable land management; and value-added and diversified agriculture and forestry”.
- Karen Klonsky, an Extension Specialist at University of California, Davis has written a simple, but excellent document called How to Finance a Small Farm and Kent D. Olson, a UC Davis Cooperative Extension Economist has written one called Farm Leases and Rents. Both publications are valuable resources, and are part of the University’s excellent Family Farm Series Publications.
- The Carrot Project “is a non-profit organization dedicated to creating financing solutions for small- and midsized farms, limited-resource farms, and those using ecologically sound practices. Our singular program model is designed to incubate and establish alternative financing programs in combination with business technical assistance.” Although their loan programs are focused specifically onfarmers in New England, (and now expanding to New York)they do have a great deal of information that may be applicable and useful to beginning farmers everywhere. These include reports such as ‘Lessons Learned: The 2009 Microloan Fund for New England Farmers‘ and Are Northeast Small Farmers in a Financing Fix? Research Results on Financing Gaps and Program Opportunities relevant to beginning farmer financing, and a quarterly E-Newsletter. Their Farmer Resources Page lists both Farm Financing Options and Farm Business and Financial Planning Resources, some of which are Multi-state, while others are New England (and New York) specific and listed by state. New England (and New York) Farmers can apply for their Farm Financing Program. They also provide Information for Investors interested in using their financial resources in a socially responsible way, by investing in projects that help to foster the growth of new farmers. Definitely a fantastic project that is worth checking out, for anyone interested in procuring loans to help build their farm business, folks who want to help support the growth of small, local beginning farmers, or institutions or groups thinking about starting a similar program in their area.
- The Equity Trust Fund (< click this link to see examples of funded projects as well as loan application procedures) is capitalized by socially motivated investors and donors. It uses its capital to make low-interest loans for community development, educational or agricultural projects:That promote the long-term interests of local communities as well as their individual members; That demonstrate the efficacy of land ownership models that balance the interests of individuals and communities; That promote social and economic justice; That promote environmentally conscious, economically sustainable land use; and that would be unlikely to receive financing from conventional sources.
- TheAppalachian Sustainable Agriculture Project (ASAP) offers Farmer Grants for Market Development. Individual farmers can apply to receive up to $1500 of assistance. Farm markets are eligible for up to $2000, and as much as $5000 is available for a group of farmers. Matching funds mean that ASAP will pay for up to half of the anticipated applicants cost for promotion and marketing materials. Current and former tobacco farmers can receive up to 75% of these marketing costs. Funds can go towards advertisements, product labeling, graphic design, posters, business cards, signs, and more. To apply, farmers must be Appalachian Grown Certified. To learn more and apply for matching funds, click HERE.
- The Organic Farming Research Foundation (OFRF) provides grants for organic farming research. Please Note – OFRF now has two separate RFP’s for grant applications: A Request for research proposals, and a Request for education and outreach proposals
- A Summary of Beginning Farmer/New Entrant Financing Programs in Canada, The US, and Japan is available at http://www.law.drake.edu/centers/docs/intlAgLaw/baker.pdf
- Check out the Association for Enterprise Opportunity for information on MicroEnterprise Loans
Wyatt Fraas, from the Center for Rural Affairs (CFRA) has kindly pointed out that most of these programs are run by State Departments of Agriculture. If your state isn’t listed, contact your Dept. of Ag. to see if they have a new program, and to make them aware that there is demand for beginning farmer loan programs in your state.
Please also check out: www.stateagfinance.org/types.html or http://www.stateagfinance.org/directory.html for more information about a number of specific state beginning farmer financing programs including Beginning Farmer Aggie Bond Programs: http://www.stateagfinance.org/types.html#aggiebond.
- Arkansas has a Beginning Farmer Loan Program offering reduced interest rates administered through the Arkansas Development Finance Authority. For more information on this program visit: http://www.accessarkansas.org/adfa/programs/bflp.html
- Colorado offers Beginning Farmer Loans through the Colorado Agricultural Development Authority. For more information visit: http://www.colorado.gov/cs/Satellite/Agriculture-Main/CDAG/1167928162022
- Illinois has a Beginning Farmer Bond Program administered through the Illinois Finance Authority, which provides reduced interest rates for purchasing farmland. For more information visit:http://www.il-fa.com/products/agriculture/programinfo.html#B
- Iowa has a Beginning Farmer Loan Program administered through the Iowa Agricultural Development Authority. For more information on this program visit: http://www.iada.state.ia.us/BFLP/index.html
- Kansas has a Beginning Farmer Loan Program administered through the Kansas Development Finance Authority. For more information visit:http://www.kdfa.org/sites/default/files/uploaded_files/Farming_Application.pdf
- Kentucky has a Beginning Farmer Loan Program administered by the Kentucky Agricultural Finance Corporation. For More Information visit: http://kafc.ky.gov/kafc_programs_beginningfarmer.shtml
- Minnesota offers a number of different loan programs through the Rural Finance Authority. For more information visit:http://www.mda.state.mn.us/grants/loans/aggiebond.aspx
- Missouri has a Beginning Farmer Loan Program administered through the Agricultural and Small Business Development Authority. For more information visit: http://www.mda.mo.gov/masbda/begfarm.htm
- Montana has a Beginning Farm/Ranch Loan Program offered through the Montana Agriculture Loan Authority. For more information visit: http://agr.mt.gov/business/bfrprog.asp
- Nebraskahas a Beginning Farmer and Rancher Loan Program administered through the Nebraska Finance Investment Authority. For information on this program visit: http://www.nifa.org/programs/index.html?topic=desc&ps=choose&prog_name_sent=Beginning+Farmer%2FRancher
- New York State has a Beginning Farmer Loan Program administered by the New York State Environmental Facilities Corporation. For more information visit: http://www.nysefc.org/
- North Dakota offers Beginning Farmer Loan Programs through The Bank of North Dakota. For more information visit: http://www.banknd.nd.gov/lending_services/farm_ranch_financing_programs/beginning_farmer_loan_programs.html
- Oklahoma’s Beginning Farmer Loan Program (OBFLP) helps provide additional credit options for those entering farming. The loan can be used to obtain or improve capital items such as agricultural land and property, depreciable machinery and equipment, and/or breeding livestock:
- Pennsylvania has a Next Generation Farmer Loan Program offered through the Pennsylvania Department of Agriculture. For more information visit: http://www.stateagfinance.org/pennsylvania.html
- Washington State has a Beginning Farmer/Rancher Loan Program offered through the Washington State Housing Finance Commission and Northwest Farm Credit Services. For more information visit: http://www.wshfc.org/FarmRanch/index.htm
Farm Credit Cooperatives are often a great option for farm loans and other financial services for new and beginning farmers. For a nice overview article explaining what farm credit cooperatives are, and how they might assist you, check out the guest post written for us by Gary Matteson, VP for Young, Beginning Small Farmer Programs and Outreach at The Farm Credit Council: http://beginningfarmers.org/farm-credit-cooperatives-offer-loan-options-for-young-beginning-and-small-farmers/
Every Farm Credit institution has some kind of enhancement program for young, beginning, and small (YBS) farmers. Since each of those 90 institutions is independently operated, their YBS programs are not the same–they are tailored to local needs. Many Farm Credit institutions have what they offer on their websites, but many do not go into the specifics unless a local office is contacted. For a “location” search to find your nearest Farm Credit office, go to www.farmcredit.com.
AgCountry Farm Credit Services “works to support the successful entry of young and beginning farmers into production agriculture through specialized credit underwriting, educational/informational programs and other activities; The Farm Credit Council “serves young, beginning, and small farmers and ranchers”; Greenstone Farm Credit Services has “special programs for young and beginning farmers”
Loans.com is a web portal to 750 commercial lenders.
Mortgage 101 provides a list of lenders, a mortgage calculator, information on mortgage rates, and more.
Mortgage Sources Corp. Agricultural Division “offers loan products with competitive rates to purchase of refinance farm real estate”.
Information about Janus Ag. Finance can be found at: http://www.janusagfinance.com/ag-finance.asp
The American Bankers Association Argiculture and Rural Banking Page can be found at: http://www.aba.com/Solutions/AgriculturalBanking.htm. They also offer an Introduction to Agricultural Lending Online Course.
Bank of America: Agriculture Loans: Finance equipment, land, or production expenses related to farming and ranching, with various repayment terms.
US Bank: Agriculture Loans: Line or load financing for equipment expenses, livestock or crop production with adjustable repayment schedules.
Janus Mortgage has loan packages for purchasing agricultural land.
PrimeTime Capital Funding provides funding for small and startup businesses using a unique combination of Government and private sources of funding for Loans, Equipment Financing, and Small Business Solutions.
Investors Resource Alliance provides agricultural business plan funding and borrower or investor loans for the purchase of goods and services to produce agricultural products.