US Code

Public Law 119-73 (01/23/2026)

12 U.S.C. § 2279aa–8

Standards for qualified loans

(a)

Standards

(1)

In general

The Corporation shall establish underwriting, security appraisal, and repayment standards for qualified loans taking into account the nature, risk profile, and other differences between different categories of qualified loans.

(2)

Supervision, examination, and report of condition

section 2279aa–11 of this titleThe standards shall be subject to the authorities of the Farm Credit Administration under .

(3)

Mortgage loans

In establishing standards for qualified loans, the Corporation shall confine corporate operations, so far as practicable, to mortgage loans that are deemed by the Board to be of such quality so as to meet, substantially and generally, the purchase standards imposed by private institutional mortgage investors.

(b)

Minimum criteria

To further the purpose of this subchapter to provide a new source of long-term fixed rate financing to assist farmers and ranchers to purchase agricultural real estate, the standards established by the Board pursuant to subsection (a) with respect to loans secured by agricultural real estate shall, at a minimum—
(1)
provide that no agricultural mortgage loan with a loan-to-value ratio in excess of 80 percent may be treated as a qualified loan;
(2)
require each borrower to demonstrate sufficient cash-flow to adequately service the agricultural mortgage loan;
(3)
contain sufficient documentation standards;
(4)
contain adequate standards to protect the integrity of the appraisal process with respect to any agricultural mortgage loans;
(5)
contain adequate standards to ensure that the farmer or rancher is or will be actively engaged in agricultural production, and require the borrower to certify to the originator that the borrower intends to continue agricultural production on the farm or ranch involved;
(6)
minimize speculation in agricultural real estate for nonagricultural purposes; and
(7)
in establishing the value of agricultural real estate, consider the purpose for which the real estate is taxed.
(c)

Loan amount limitation

(1)

In general

A loan secured by agricultural real estate may not be treated as a qualified loan if the principal amount of such loan exceeds $2,500,000, adjusted for inflation, except as provided in paragraph (2).

(2)

Acreage exception

Paragraph (1) shall not apply with respect to any agricultural mortgage loan described in such paragraph if such loan is secured by agricultural real estate that, in the aggregate, comprises not more than 2,000 acres.

(d)

Nondiscrimination requirement

The standards established under subsection (a) shall not discriminate against small originators or small agricultural mortgage loans that are at least $50,000. The Board shall promote and encourage the inclusion of qualified loans for small farms and family farmers in the agricultural mortgage secondary market.

Pub. L. 92–181, title VIII, § 8Pub. L. 100–233, title VII, § 702101 Stat. 1700Pub. L. 100–399, title VI, § 601(i)102 Stat. 1005Pub. L. 104–105, title I, § 110110 Stat. 165Pub. L. 110–234, title V, § 5406(c)122 Stat. 1158Pub. L. 110–246, § 4(a)122 Stat. 1664Pub. L. 115–334, title V, § 5410(a)132 Stat. 4678(.8, as added , , ; amended , , ; , , ; , , ; , title V, § 5406(c), , , 1920; , , .)

Editorial Notes

Codification

Pub. L. 110–234Pub. L. 110–246Pub. L. 110–234section 4(a) of Pub. L. 110–246 and made identical amendments to this section. The amendments by were repealed by .

Amendments

Pub. L. 115–3342018—Subsec. (c)(2). substituted “2,000” for “1,000”.

Pub. L. 110–246, § 5406(c)(1)2008—Subsec. (a). , added pars. (1) and (2), designated last sentence as par. (3) and inserted heading, and struck out former first sentence which read as follows: “Not later than 120 days after the appointment and election of the permanent Board, the Corporation, in consultation with originators, shall establish uniform underwriting, security appraisal, and repayment standards for qualified loans.”

Pub. L. 110–246, § 5406(c)(2)(A)Subsec. (b). , inserted “with respect to loans secured by agricultural real estate” after “subsection (a)” in introductory provisions.

Pub. L. 110–246, § 5406(c)(2)(B)Subsec. (b)(5). , substituted “ensure that the farmer or rancher” for “ensure that the borrower” and “farm or ranch” for “site”.

Pub. L. 110–246, § 5406(c)(3)Subsec. (c)(1). , inserted “secured by agricultural real estate” after “A loan”.

Pub. L. 110–246, § 5406(c)(4)Subsecs. (d), (e). , (5), redesignated subsec. (e) as (d) and struck out former subsec. (d). Prior to amendment, text read as follows: “No standard prescribed under subsection (a) shall take effect before the later of—

“(1) the end of a period consisting of 30 legislative days and beginning on the date such standards are submitted to the Congress; or

“(2) the end of a period consisting of 90 calendar days and beginning on such date.”

Pub. L. 104–1051996—Subsec. (e). inserted at end “The Board shall promote and encourage the inclusion of qualified loans for small farms and family farmers in the agricultural mortgage secondary market.”

Pub. L. 100–3991988—Subsec. (a). inserted “permanent” after “appointment and election of the”.

Statutory Notes and Related Subsidiaries

Effective Date of 2018 Amendment

Pub. L. 115–334, title V, § 5410(b)132 Stat. 4678

132 Stat. 472412 U.S.C. 2279aa–8(c)(2)“The amendment made by subsection (a) [amending this section] shall take effect 1 year after the date a report submitted in accordance with section 5414 of this Act [] indicates that it is feasible to increase the acreage limitation in section 8.8(c)(2) of the Farm Credit Act of 1971 [] to 2,000 acres [report submitted June 2019].”
, , , provided that:

Effective Date of 2008 Amendment

Pub. L. 110–234Pub. L. 110–246Pub. L. 110–234section 4 of Pub. L. 110–246section 8701 of Title 7Amendment of this section and repeal of by effective , the date of enactment of , see , set out as an Effective Date note under , Agriculture.

Effective Date of 1988 Amendment

Pub. L. 100–399Pub. L. 100–233section 1001(a) of Pub. L. 100–399section 2002 of this titleAmendment by effective as if enacted immediately after enactment of , which was approved , see , set out as a note under .