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Interest Assistance Program

Program Descriptions

Program Number



Interest Assistance Program


Federal Agency




Consolidated Farm and Rural Development Act, as amended.






To provide a 4 percent subsidy to farmers and ranchers, who do not qualify for standard commercial credit. Guaranteed loans are serviced by a lender who has entered into a Lenders Agreement with the agency.


Types of Assistance

Guaranteed/Insured Loans.


Uses and Use Restrictions

The Interest Assistance Program can be provided for Operating Loans (OL). Under the interest assistance program, FSA will subsidize 4 percent of the interest rate on loans to qualifying borrowers. Operating Loans (OL) may be used: (1) to finance livestock or farm equipment; (2) to pay annual operating expenses or family living expenses; or (3) to refinance debts under certain conditions. Lines of Credit (LOC) are operating loans for annual operating loan purposes. Funds may be advanced and repaid (revolve) throughout the year. The total loan limit for a guaranteed loan cannot exceed $731,000.


Eligibility Requirements

Applicant Eligibility

Individuals, partnerships, or joint operations, legal resident aliens, corporations and cooperatives that meet the eligibility requirements for a guaranteed loan and are able to project the required cash flow margins with the aid of interest assistance.

Beneficiary Eligibility

This program aids both the borrower and lender by providing 4 percent of the interest costs and receiving up to a 90 percent guarantee on the loan.


None. This program is excluded from coverage under OMB Circular No. A-87.


Application and Award Process

Preapplication Coordination

None. This program is excluded from coverage under E.O. 12372 and OMB Circular No. A-102.

Application Procedure

The lender must submit to the agency on behalf of the applicant, all required forms to the FSA county office, where the proposed operation will be located. Contact the lender in your area for completion of all required forms. Additional information can be obtained by contacting the FSA office in your local area. Farm Service Agency offices are listed in the telephone directory under U.S. Government, Department of Agriculture.

Award Procedure

Not applicable.



Range of Approval/Disapproval Time

One to 30 days.


At the time of any rejection FSA will notify the lender and loan applicant of appeal rights and procedures.



Assistance Considerations

Formula and Matching Requirements

Not applicable.

Length and Time Phasing of Assistance

Interest Assistance agreements will be granted for a term not to exceed 10 years from the date the first agreement was signed.


Post Assistance Requirements


The lender is required to file Form FSA 1980-24 annually. This form will reflect current loan information, request a claim payment and establish the amount of interest assistance for the next year.


FSA will review Form FSA 1980-24 annually. In addition, FSA will require a loan activity summary and calculation of interest charges.


The type of records required will be on a case-by-case basis.


Financial Information

Account Identification

12-4140-0-3-351; 12-1140-0-1-351.


(Subsidized Guaranteed Loans) FY 07 $272,250,000; FY 08 est not available; and FY 09 est not reported.

Range and Average of Financial Assistance

$1 to $731,000. Average: $158,000.


Program Accomplishments

Not available.


Regulations, Guidelines and Literature

Regulations published at 54 FR 1534, codified in 7 CFR Part 762 and FSA Handbook 2 FLP.


Information Contacts

Regional or Local Office

Farm Service Agency State Offices can inform applicants of county office locations where applicants may apply for assistance. FSA State Office locations are listed in Appendix IV of the Catalog. Or visit the website at: FSA has more than 2,500 county offices serving every rural county in the United States.

Headquarters Office

Department of Agriculture, Farm Service Agency, Director, Loan Making Division, Ag Box 0522, Washington, DC 20250. Telephone: (202) 720-1632.

Web Site Address


Related Programs



Examples of Funded Projects



Criteria for Selecting Proposals

Each loan application will be judged on its own merit and processed in chronological order.


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