Iowa Finance Authority
Programs

Which Loan Program Is Right For You?

The Beginning Farmer Loan Program and Loan Participation Program help Iowa farmers purchase agricultural land, depreciable machinery or equipment, breeding livestock or buildings. The IADD loans may also be used to improve existing buildings or farmland. These programs may be used independently or in conjunction with one another. Both loan programs can only be used for new purchases and neither program can be used to refinance existing debt.

A beginning farmer can participate in both of these programs at the same time, as long as the applicant and project meet both programs' guidelines.

  Beginning Farmer Loan Program (BFLP)

Loan Participation Program (LPP)

Age At least 18 years old; no upper age limit At least 18 years old; no
upper age limit
Eligible Projects Breeding livestock, machinery, land & farm improvements Breeding livestock,
machinery, land & farm
improvements
Lender's Certification None Certify that no other private
or state credit can be obtained; FSA does not need to certify
denial
Land Ownership Cannot own substantial farmland (30% of county median acres) No restrictions
Buy From Close Relatives Yes Yes
Minimum Loan None None
Maximum Loan

Maximum Bond Amount
(See BFLP for current maximum)

$250,000: Farm improvements and new depreciable property 

$62,500: Used depreciable property

30% purchase price or $200,000 participation loan
Maximum Net Worth Maximum allowable net worth (See Who is a Beginning
Farmer
current maximum)
Maximum allowable net worth
(See Who is a Beginning
Farmer
for current maximum)
Application Fee $100 $100
Closing Fee

1.5% of IADD Bond 
$300 minimum

1.50% of IADD participation loan
$300 minimum

Current Ratio N/A Cannot be less than 1.1 without a guaranteed source of repayment?
Debt To Asset Ratio (D to A) N/A Cannot exceed 80% without guaranteed source of repayment
Debt to Coverage Ratio (DCR) N/A If D to A ratio is < 60% then
DCR > 110%
If D to A ratio is > 60% then
DCR > 120%
Off-Farm Income No restrictions Cannot exceed 50% of beginning farmers projected total gross income
Corporation, Partnerships, LLCs Eligibility No No

 

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Steve Ferguson | Tax Credit Program Specialist
515.725.4928

Tammy Nebola | Loan Program Specialist 
515.725.4919