Recent trends show a growing interest among young people in taking up farming, but the steep costs associated with starting a farm are preventing many from getting their dreams off the ground. Fortunately, United States Agricultural Secretary Tom Vilsack recently announced the government would introduce new loans that could help budding farmers get started. Since starting a farm typically requires purchasing land and agricultural equipment, the cost can be out of reach for many recent graduates.
Vilsack announced the new program during an address to the Virginia Farm Bureau, according to The Associated Press. The idea is to provide federal loans of up to $35,000 to those interested in starting their own farm. Getting approval for the new loans will require roughly half the paperwork of applying for typical financing, the news source reports. Due to their short credit history, many interested in starting a farm have trouble getting approved for commercial loans.
"We see this as an entryway for innovation and entrepreneurship in rural America to complement production agriculture and to allow an easier way for young people to get into this business," Vilsack told the news source. "This is going to allow us to increase the number of people in farming, which is very important given the age of the average farmer in Virginia and the country - close to 60 years of age."
Over the past three years, the Department of Agriculture (USDA) has offered more than 100,000 loans to farmers, totaling over $14.6 billion. More than half of that money was given to farmers just starting out, minorities or disabled veterans. USDA loans can be used to purchase livestock, feed, seed, land and agricultural equipment such as tractors and sprayers.
Farmers who are just starting out will need to keep costs low. One smart use for a USDA loan is to purchase used agricultural equipment, which is often more affordable than buying new. The online auction site IronPlanet offers a wide variety of equipment backed by IronClad Assurance inspection reports.
