Cover photo for Hawaii New Farmer Loan

Hawaii New Farmer Loan

Hawaii Department of Agriculture

About

The Hawaii New Farmer Loans are part of the Hawaii Agricultural Loan Division.

The State of Hawaii, Department of Agriculture’s Agricultural Loan Division administers the Agricultural Loan Program and the Aquaculture Loan Program. The intent of the programs is to help promote agricultural and aquacultural development of the State by providing credit at reasonable rates and terms to qualifying individuals or entities. Through the establishment of a revolving loan fund, credit is made available by supplementing private lender sector loan funds or by providing direct funding.

Considered a “lender of last resort”, the program is not intended to compete with private sector lenders. Prospective applicants must inquire with and be denied credit from private sector lenders prior to filling an application. In addition, prospective applicants must fulfill applicable eligibility requirements. Applicants that are not able to obtain denials from the private lending sector may inquire with the private lender on the possibility of utilizing the insured/guaranty and/or participation loan facilities.

Eligibility

A New Farmer is:

  • A citizen of the United States who has resided in Hawaii for the preceding three years, or any permanent resident alien who has resided in Hawaii for the preceding three years; and

  • A person who has successfully earned a degree in agriculture from an accredited university or community college; or

  • A person displaced from employment in an agricultural production enterprise; or

  • A person with two years experience as a part-time farmer; or

  • A farm laborer or tenant, or a person who by reason of ability, experience and training are likely to successfully operate a farm.

  • Certain restrictions may apply.

New Farmer Loans are for applicants who intend to farm full-time. A full-time farmer is a person who devotes most of their time to farming or derives most of their income from farming operations. A down payment or equity contribution equal to 15% of the total project cost is required from the applicant.

Terms

Loan Rate and Amount:

  • Interest Rates:  6% or 1.5% below the prime rate whichever is less with an interest rate floor of 3%. Rates are fixed at time of loan approval.

  • Amount: $250,000 (see Note)

Note: Maximum loan amount of $250,000 may be used for a Farm Ownership and Improvement loan or a Farm Operating loan, or a combination of both types of loans.

Farm Ownership and Improvement Loans:

  • Purpose: Purchase or improvement of farmland; construction, or improvement of essential farm buildings; liquidation of indebtedness for the foregoing purposes.

  • Maximum Term: 40 years

Farm Operating Loans:

  • Purpose: Purchase of farm equipment and livestock; payment of production and marketing expenses including materials, labor, and services; payment of living expenses; liquidation of indebtedness incurred for the foregoing purposes.

  • Maximum Term: 10 years

Micro-Loans are also available for New Farmers, however, theses loans are restricted to operating loan purposes only. The maximum loan amount is $25,000 and the maximum term is 10 years. The application process minimizes paperwork and the loan approval process is expedited.

Resources

Similar Programs

Details

Organization

Hawaii Department of Agriculture (HDOA)

Financial Instrument

Loan

Maximum Award Amount

$25,000

Updated July 19, 2021

This information was gathered from public sources. Ambrook is not responsible for or able to affect the results of any financial programs listed, nor are they responsible for any incorrect information that is listed or is on the hyperlinked external sites. All information is subject to change.