GILFILLAN ESTATE — Minnesota State Auditor Julie Blaha talked about the Rural Finance Authority and the agricultural financing opportunities it provides Wednesday at Farmfest.
A member of the RFA board, Blaha said RFA offers low-interest loan programs to farmers for a variety of activities and partners with local lenders to provide affordable credit to eligible farmers.
“The loans through the Minnesota Department of Agriculture are for new farmers and can be a low-cost bridge with low interest rates,” Blaha said.
Loan participation programs include basic farm and seller-assisted loans that help younger and beginning farmers purchase agricultural land.
Agricultural improvement loans finance farm improvements for any agriculture-related purpose, such as grain handling facilities, machine storage and manure systems.
Restructure loans help farmers reorganize farm debt to improve cash flow.
Livestock expansion loans create affordable financing for modernizing and updating livestock production facilities.
To date, more than $270 million has been invested in 2,959 RFA loans.
Current interest rates ranged from 2 to 2.5% with no origination fee and $50 application fees.
The Aggie Bond program creates a federal tax exemption for banks, and a federal and state tax exemption on interest income to an individual seller in exchange for offering below market interest rates to eligible, beginning farmers to buy farm real estate, agricultural improvements, breeding livestock and machinery.
Revolving accounts support other loans. Sustainable agriculture and manure digester loan programs are administered by the MDA’s Finance and Budget and Ag Marketing and Development Divisions.
For more information, visit .mda.state.mn.us/financebudget/agfinance.
(Fritz Busch can be emailed at [email protected])