In a significant move to support struggling farmers, the U.S. Department of Agriculture (USDA) has introduced automatic financial assistance for qualifying borrowers under the Guaranteed Farm Loan Programs (FLP). This assistance is part of the larger effort, backed by $3.1 billion from the Inflation Reduction Act, to provide aid to distressed farm loan borrowers.
Agriculture Secretary Tom Vilsack expressed the USDA's commitment to aiding producers on their journey toward financial recovery. He noted that assistance offers a fresh start for distressed borrowers, fostering stability and success for agricultural businesses.
Since the Inflation Reduction Act was enacted in August 2022, the USDA has allocated approximately $1.15 billion to assist over 20,000 distressed borrowers. The objective is to support farmers in overcoming challenges, removing barriers that hinder their return to farming, and enhancing USDA's long-term borrowing and loan servicing approach.
The financial aid unveiled today will extend to qualifying distressed guaranteed loan borrowers, mirroring the assistance previously provided to distressed direct loan borrowers. Around 3,500 eligible borrowers are projected to benefit from this aid, though numbers may evolve as payments are finalized.
To qualify for this assistance, an FLP guaranteed loan borrower must meet specific criteria, including:
- Clearing outstanding delinquency on qualifying FLP guaranteed loans.
- Having a loan restructured between March 1, 2020, and Aug. 11, 2023.
- Receiving deferrals or payment extensions due to COVID-19, disasters, or revenue shortfalls.
The aid will be automatically provided to distressed guaranteed loan borrowers who did not receive an initial payment under the Inflation Reduction Act assistance in October 2022.
Distressed borrowers who meet the criteria will receive a Treasury check jointly payable to them and the lender. The assistance aims to alleviate financial burdens and encourage borrowers to continue their farming endeavors.
As the USDA continues its commitment to distressed borrowers, it assures farmers of ongoing updates and assistance to support their recovery and success.