H.R. 6169: Fair Credit for Farmers Act

H.R. 6169 would give certain financially distressed USDA farm borrowers a 2-year payment pause while dropping their interest rate to 0.125%.

That relief applies to direct farm ownership, operating, and emergency loans for eligible borrowers who are delinquent or financially distressed, except very short loans with terms of 12 months or less. The bill also pushes guaranteed lenders to waive guarantee fees for covered producers, including beginning, veteran, limited-resource, and socially disadvantaged farmers and ranchers.

The bill also says USDA should not be able to deny your application for one reason, then come back later with a different reason it already knew about. Determination letters would have to spell out the reasons for an adverse decision and point borrowers to the relevant rules and handbooks.

For collateral, the bill says USDA can use your principal residence only when other assets are not enough to secure the loan. If your other collateral later covers 100% of the remaining loan, USDA would have to start releasing your home from that security automatically.

H.R. 6169 also opens more pathways into USDA lending. Beginning farmers could qualify for ownership loans without the usual 1 year of management experience if they have an approved mentor or other acceptable education or experience, and some non-USDA debt could be refinanced into USDA ownership loans.

On appeals, the bill would shift more of the burden onto USDA in some cases. For appellants with adjusted gross income of $300,000 or less, USDA would have to show by substantial evidence that its adverse decision was not erroneous.