FSA Loan Programs for Cooperatives

• cooperatives
• fsa
• entity loans

What is a farm cooperative?

A cooperative is a business owned and controlled by the people who use it. Members may buy supplies together, market crops or livestock, process products or share equipment. Profits are typically shared with members based on use, not just on ownership.

Legal structures vary. Some cooperatives are organized under state law as corporations, others as limited liability companies, and some are owned by smaller groups of farmers. Which category you fall into matters for credit programs, so know your organizing documents.

Think about how members benefit. Some cooperatives are small and local, while others serve thousands of farmers. The size and purpose of yours will shape which lenders and programs make sense.

What does FSA offer for cooperatives?

FSA publishes a fact sheet on loans to for-profit farm cooperatives. It describes eligibility conditions, loan uses and how the program works for cooperatives that produce or farm. Its limits are not repeated here. Read the current fact sheet and ask the office to confirm which parts apply.

Not every cooperative qualifies, and the program differs from loans to individual farmers. Typically, program rules look at who owns the cooperative and whether its members are themselves farm operators.

Because program details and funding vary, treat the fact sheet as a map and the loan officer as the guide. Take your own notes to every conversation and follow up in writing.

Who is likely to qualify?

Eligibility rules for entities focus on ownership and on the type of operation. For a cooperative, staff generally want to see who the members are, whether they are family farmers or ranchers, and whether the business is engaged in farming rather than only handling products from others.

Gather your articles of organization, bylaws, member list and ownership percentages. If you are not sure whether your organization is eligible, ask the loan officer early. A short call can save weeks of preparation.

Keep in mind that eligibility is decided by the agency under its written rules, not by this site or by what a neighbor cooperative received.

What can the loan be used for?

Loan purposes are set by program rules. In general, farm loans can support things like land, equipment, livestock, operating costs and certain improvements, but the allowed list differs for each loan type and for entities.

Ask which purposes are allowed for cooperatives and which are not. Put the intended use in your plan with a budget, so staff can tell what the money will buy and how it supports farm income.

Make the case in your plan. A loan for a shared piece of equipment, for example, should show how many members will use it, how it will be paid for, and what happens if a member leaves.

• Land or facility purchases
• Equipment and machinery
• Livestock or inputs
• Operating costs for a season
• Improvements tied to farm production

What will the application require?

Entities commonly need more paperwork than individuals. Expect organizing documents, financial statements, tax returns, a business plan, and information about members or owners. FSA publishes a separate quick guide for entities that lists the usual items.

Bring cooperative governance documents showing who is allowed to sign. Staff will want to see that the person signing has authority from the board or members.

How does it compare with other cooperative credit?

Cooperatives often have other credit options. Farm Credit institutions, commercial banks and cooperative banks serve member-owned businesses, and some offer loans that FSA does not. FSA is generally meant for cases where credit is not available elsewhere on suitable terms.

Compare options on purpose, cost, collateral, paperwork and repayment. Never assume the government option is automatically cheapest. Ask every lender for terms in writing.

A joint call with the cooperative's manager, board chair and accountant often works best, since each can answer different questions about finances, governance and member needs.

What questions should the board ask first?

Before the board commits to an application, assemble a short list and call the loan officer together.

Board members should also read the plan together, since they carry responsibility for the debt.

• Does our structure meet the program's eligibility rules?
• Which loan purposes are allowed for us?
• Who must sign and guarantee?
• What financial statements do you need?
• What other credit options should we compare?

Last reviewed: November 12, 2026. Written by the Farm Money & Grants Editorial Team. Educational only, not tax, legal or financial advice. See our editorial policy.