Glossary

Farm Service Agency (FSA) Farm Ownership Loan

Also known as: FSA farm loan, FSA direct loan, FSA guaranteed farm loan, FSA

A USDA Farm Service Agency loan program financing farm real estate and operations, available either as a direct loan (made and serviced by the FSA itself, generally for borrowers who can't obtain adequate conventional or Farm Credit System financing) or as a guarantee behind a conventional lender's farm loan.

FSA direct loans are reserved primarily for borrowers -- often beginning farmers or those in underserved categories -- who cannot obtain adequate credit from a conventional lender or a Farm Credit System association; FSA guaranteed loans instead let a conventional lender originate and service the loan while the FSA guarantees a substantial portion of it, similar in structure to an SBA or USDA Business & Industry guarantee but specifically for farm ownership and operating purposes. This is a distinct USDA program from USDA Business & Industry (B&I), which guarantees financing for rural businesses and their real estate generally rather than farming operations and farmland specifically.