Understanding USDA Loans & Training as a First-Time Farmer

USDA Basics for First-Time Farmers

When I first started looking into USDA loans, I assumed the process would be fairly straightforward: learn the requirements, apply, and move forward if approved. What I quickly discovered is that USDA farm loans are designed for people who are already actively building farming experience—and the learning curve can be steep if you’re starting from scratch.

This series exists to document what I learned while researching USDA and Farmers.gov programs as a first-time farmer, with the goal of helping others understand the system before they apply.

USDA loans are not grants, and they are not beginner handouts. They are government-backed loans intended to help farmers who may not qualify for traditional financing but can demonstrate training, experience, and a viable plan to operate a farm business.

For first-time farmers, the most commonly referenced programs are:

• USDA Farm Service Agency (FSA) Direct Farm Ownership Loans
• FSA Direct Operating Loans
• Microloans (a simplified option with lower borrowing limits)

Each of these programs has different use cases, but they all share one major requirement: you must show that you are capable of successfully operating a farm.

That capability is evaluated through three main areas: experience, training, and record-keeping.

Experience does not mean you need to come from a multigenerational farm. USDA understands that many first-time farmers are transitioning from other careers. However, they do expect you to demonstrate hands-on involvement in agricultural activities. This can include:

• Growing crops for sale
• Managing a farm stand or CSA
• Working or apprenticing on a farm
• Operating your own small-scale production, even on rented land

What matters most is that your experience is real, documented, and relevant to the type of farming you plan to do with the loan.

Training is equally important. USDA often looks for formal or semi-formal education that supports your farming goals. This can include:

• Agricultural extension courses
• Farm business management classes
• Community college or online ag programs
• USDA-recognized training hours
• Mentorship or apprenticeship documentation

One of the biggest misconceptions is that training must be expensive or full-time. In reality, USDA often accepts a combination of coursework, workshops, and hands-on learning—as long as it directly supports your proposed operation.

Record-keeping is where many first-time farmers get stuck. USDA loan officers want to see that you understand the financial side of farming, not just production. This includes:

• Income and expense tracking
• Basic bookkeeping
• Farm business planning
• Tax records (including Schedule F, if applicable)
• Production records for crops or livestock

Even if you are not profitable yet, showing that you track your numbers consistently is a major credibility factor.

Another critical component of USDA loans is the farm business plan. This plan outlines what you intend to produce, how you will market it, what your costs are, and how the loan will support the operation. It does not need to be corporate or polished, but it does need to be realistic and well thought out.

USDA loan officers are not looking for perfection. They are looking for preparation, consistency, and responsibility.

It’s also important to understand that many first-time farmers are encouraged—or required—to complete additional training before approval. Being asked to complete training is not a failure; it is often a step in the process.

In my own research, I learned that timing matters. Applying too early, before experience and records are in place, can lead to denial that could have been avoided with more preparation. In many cases, spending one or two seasons intentionally building experience and documentation can make a significant difference.

This series breaks down USDA loans from a first-time farmer perspective, including:

• How the application process actually works
• What loan officers typically look for
• Common reasons first-time applications are denied
• How to build a strong foundation before applying
• Practical ways to gain qualifying experience and training

If you’re considering a USDA loan, or even just exploring the possibility, this series is designed to help you approach the process informed, prepared, and realistic.

Follow along as I share what I learned navigating USDA loans and training as a first-time farmer—so you can make decisions with clarity instead of confusion.