What does Preamble of S 3936 do?

This bill proposes to amend the Consolidated Farm and Rural Development Act. The proposed amendment expands eligibility for guaranteed and direct loans. Eligibility is extended to individuals or entity members holding at least a 50 percent interest. These individuals or entities must be or become qualified operators of the farm real estate involved.

What does SHORT TITLE. of S 3936 do?

This bill is formally titled the USDA Loan Modernization Act.

What does PERSONS ELIGIBLE FOR REAL ESTATE LOANS. of S 3936 do?

This section amends Section 302(a) of the Consolidated Farm and Rural Development Act (7 U.S.C. 1922(a)). It changes the requirement from 'a majority' to 'at least a 50 percent' in certain paragraphs. It removes subparagraphs (A) and (B) of paragraph (2) and replaces them with new provisions regarding eligibility. Qualified operators, as defined by the Secretary, are now considered to meet the operator requirement. Certain operating-only entities can meet owner-operator requirements if an owner of the farm real estate owns at least 50 percent of the applicant. Certain embedded entities can meet direct ownership requirements if at least 75 percent of their ownership interests are owned by qualified operators.

What does PERSONS ELIGIBLE FOR OPERATING LOANS. of S 3936 do?

This section amends Section 311(a) of the Consolidated Farm and Rural Development Act. The requirement of 'a majority' is changed to 'at least a 50 percent' in paragraph (1) of Section 311(a). Qualified operators, as defined by the Secretary, are now eligible to meet the operator requirement. Entities owned by other entities may meet the direct ownership requirement if at least 75 percent of the total ownership interests are owned by qualified operators.

What does PERSONS ELIGIBLE FOR EMERGENCY LOANS. of S 3936 do?

This section amends Section 321 of the Consolidated Farm and Rural Development Act (7 U.S.C. 1961) to modify eligibility requirements for emergency loans. The amendments revise the numbering of subsections within Section 321(a). The amendments establish special rules for qualified operators, allowing them to meet the operator requirement. The amendments clarify eligibility for applicants who are only operators of farm real estate acquired with funds under the subtitle. The amendments address the eligibility of embedded entities, requiring at least 75% of ownership interests to be owned by qualified operators. The section redesignates and replaces the existing text preceding paragraph (2) of subsection (a) with a revised section heading and introductory language.

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USDA Loan Modernization Act — S. 3936

Last updated: 2/26/2026 · Introduced: 2/26/2026

Author: Tommy Tuberville (R-AL)

TL;DR (AI)

This bill amends the Consolidated Farm and Rural Development Act to allow individuals or entities holding at least a 50% interest in farm real estate to be eligible for farm ownership, operating, and emergency loans, provided they are or will become qualified operators.
The bill clarifies that qualified operators, as defined by the Secretary, can meet operator requirements for loan eligibility, even if the applicant is an entity owned by another entity.
For entities, the bill requires that at least 75% of ownership interests be owned by qualified operators to meet direct ownership or embedded entity requirements for loan eligibility.

119th Congressin committeeOfficial page

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Includes provisions on preamble, short title., and 3 more.

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