Microloan Helps Navajo Couple Continue Farming Tradition

USDA Blog Post:

Posted by Tanya Brown, Writer/Editor, Farm Service Agency, on April 10, 2014 at 3:00 PM

Marilyn and Erik Simpson returned to the Navajo Reservation in Torreon, N.M., to help Marilyn’s aging parents and to grow their own farming operation that would benefit their family.

This post is part of a Microloan Success feature series on the USDA blog. Check back every Tuesday and Thursday as we showcase stories and news from USDA’s Farm Service Agency.

Marilyn Simpson grew up on the Navajo Reservation in Torreon, N.M., where she learned all about farming from her parents who raised sheep and cows.

The youngest of eight children, Marilyn left the reservation, and her parents, to go to college in Arizona. That’s also where she met her husband Erik. After graduating, she and Erik moved back to Torreon to help Marilyn’s parents.

“We saw that my parents were getting older and they needed help with the animals,” said Marilyn, whose parents only speak Navajo. “We eventually took over their operation.”

For 14 years the couple managed her parents’ operation. Now, Marilyn, age 35 and Erik, 39, decided they wanted to start out on their own while still caring for her parents and living on the reservation.

The couple had heard about USDA’s Microloan program. The program allows beginning, small and mid-sized farmers to access up to $35,000 in loans using a simplified application process with up to seven years to repay.

Marilyn and Erik came up with a plan on how much they wanted to borrow and how they planned to back the loan before contacting a Farm Service Agency (FSA) loan officer. After deciding that the Microloan was the best option, they contacted the Torrance County FSA.

Farm Loan Manager Allen Mackrain mailed a microloan application and then drove 2½ hours one way to their home on the reservation to meet with the couple, help answer questions, see the operation and close the loan.

“The Microloan is a great help because a lot of conventional lenders aren’t able to make these loans on the tribal trust lands,” said Mackrain. “A lot of tribal members have grazing and/or farming permits but no way to purchase animals or equipment to utilize the land. This gives them an opportunity to do that.”

The loan allowed the couple to purchase 25 bred cows and rent a bull. That helped expand their herd to 42 cows. They now also have five yearling heifers.

“We wanted something of our own but we also wanted to stay on the reservation and close to our culture,” said Marilyn. The couple has three children, ages 13, 10 and 7, who are learning the Navajo language from their grandparents. “We have a lot of fun and the kids are learning a lot about the animals and their culture. It’s good for them.”

To date, USDA has issued more than 4,900 microloans totaling $97 million. USDA is focused on increasing opportunities for farmers and ranchers and has made several modifications to farm loan programs, including making Microloans to beginning farmers and veterans exempt from direct loan term limits.

Visit the FSA website to learn more about our farm loan programs.

Microloan Helps South Dakota Man Transition from Desk to Farm

USDA Blog Post:

Posted by Tanya Brown, Writer/Editor, Farm Service Agency, on March 27, 2014 at 5:00 PM

David Hoff left his job to return to the farm and help his father. The Microloan helped Hoff acquire operating inputs when other lenders wouldn’t take a chance on him.

This post is part of a Microloan Success feature series on the USDA blog.  Check back every Tuesday and Thursday as we showcase stories and news from USDA’s Farm Service Agency.

For David Hoff, farming was in his blood.  It had been 14 years since he worked on his family’s South Dakota farm.  He went off to college, earned a degree in business, landed a position in sales and, over the next 10 years, held leadership positions in sales for several companies.  But he had been thinking long and hard about returning to the 2,000 acre farm and rejoining the family operation.

Then in 2012, Hoff received the sad news of his uncle’s death.  His uncle had farmed with Hoff’s father in Hutchinson County, S.D. for years.  That’s when Hoff decided to return and help his father with the farm.

“This was a big change for us. I was used to bringing home a paycheck every two weeks and now that was going to change in a big way,” said Hoff. “There are no guarantees in farming and you can’t write down what you are going to make each year. My wife likes to have a clear plan and that was a challenge for her to overcome.”

“I explored various options such as putting all the inputs on my credit card and obtaining financing through some other source,” said Hoff. “But those options weren’t an option.”

The high interest on the credit cards would cut into his profits or could potentially lower his credit rating, while commercial lenders wouldn’t take a chance on someone 14 years removed from the farm.  So it was difficult for the new farmer to come up with the money to pay operating inputs.

Then one day Hoff’s father, Joe, took a routine trip to the local Farm Service Agency (FSA) office where he learned about USDA’s Microloan program. The program allows beginning, small and mid-sized farmers to access up to $35,000 in loans using a simplified application process with up to seven years to repay.

“My father discussed my options with an FSA loan officer and found out that the Microloan was a perfect fit for my operation,” said Hoff. “The $30,000 loan allowed us to pay for farm related expenses as well as cost of living support until I was able to market my alfalfa, corn, and soybeans and generate income.”

Now in his second year, Hoff graduated from the Microloan and received an operating loan to purchase equipment and help farm 300 acres of corn, soybeans and alfalfa in 2014.

“My ultimate goal is to continue the family farm. My dad turns 65 this year and slowly wants to step back. I say slowly because he is not quitting farming, but I am taking on a bigger role this year and eventually will make majority of the farm operation decisions,” said Hoff.  “There is no way I could have made this career change without the full support of my wife and I couldn’t have started farming without my mom and dad’s support and guidance. I don’t regret it at all and I wouldn’t change a thing.”

USDA employees are proud to see the progress that farmers and ranchers are making in their daily operations with the help of the Microloan program. To date, USDA has issued more than 4,900 Microloans totaling $97 million. Visit the FSA website to learn more about our farm loan programs.

David Hoff was used to getting a paycheck every two weeks. That changed when he moved back to the farm. The FSA Microloan helped him with cost of living expenses until he was able to sell his crops.