USDA News You Can Use: Grants for Improving Agriculture

The United States Department of Agriculture (USDA) is committed to improving the agriculture industry in the United States. At any given time, they offer a great number of grants and funding to help those in the ag industry to expand their operations, solve a pest or disease problem, complete a conservation project, move into new products and produce, and more. See the latest news coming out of the USDA on grants to improve agriculture in the U.S.Read More


Drought Devastates California: 800,000 Acres Left Unplanted

According to the California Farm Water Coalition (CFWC) – the largest organization to focus solely on farm water with 5.6 million irrigated acres in California – lack of adequate rainfall this season will leave 800,000 acres of farmland (up from 500,000) left unplanted.

While many farmers desperately hope to see a turnaround in the persistently dry conditions, it’s not looking good. The longer these conditions continue, the more acres of farmland left unplanted. With the end of the “rainy” season quickly approaching, the odds of returning to a normal water year are slim.

Based on recent survey results, the negative impacts of the drought to California’s economy are astronomical.

  • Farm production and associated business losses have increased about 50% to $7.48 billion according to February estimates.
  • On-farm production losses are expected to double from $1.7 billion to approximately $3.56 billion.
  • Unemployment is predicted to rise above 40% in valley communities.
  • Roughly 15,000 on-farm and associated jobs will be lost, including processing, transportation, packaging as well as port jobs in Los Angeles, Long Beach, and Oakland.
  • Come this spring and summer, some market watchers have predicted a 10% to 15% increase in consumer prices.
  • Deliveries from other watershed sources will dwindle, with estimates ranging from above 50% to some as low as 15-25% of normal supplies.

Solutions in the face of the California drought are scarce. In fact, the drought has been called an “unsustainable situation” for farms in the times ahead. There simply is not adequate water in the system and there’s not much to be done to reverse the devastation. Had California leaders taken the drought seriously, had additional water storage facilities been built, and had the funneling of water to environmental uses been implemented into the system, then maybe the severity of the situation and its impacts would have been curtailed.

Bankers South recognizes that farming and ranching is hard work, especially in times of grim weather conditions. Our goal is to assist in any way we can when it comes to farmland financing, helping to ease the process so you can focus on your farm’s day to day operations. Our AgAmerica lending program boasts agricultural land loans that align with various needs. To learn more, contact Bankers South. One of our ag loan experts will be in touch to aid you through the ag lending process.


Why Ag America Lending?

Bankers South is proud to be the only ag lending company in the Southeast authorized to offer AgAmerica loans. These exclusive loans boast interest rates that often beat all other agriculture loan programs. Covering all facets of farming, from smaller blueberry farms to vast cattle ranches, there’s bound to be an AgAmerica loan fit for your agribusiness and its goals.

Agricultural Land Loans

Whether you are expanding your existing ranch, purchasing a farm, planting your next row crop, expanding your groves, planting timber, buying more cattle, or making long-term enhancements to your farming or ranching operation, Bankers South has an agricultural land loan that fits your needs. Ag financing options extend to the following operations:

  • Farms of all types
  • Ranches
  • Dairies
  • Orchards
  • Vineyards
  • Groves
  • and more

 

Ag Loan Refinancing

If you want to refinance your agricultural or farm land loans to lower monthly payments, score lower rates, change the maturity of your loan, switch from an adjustable to a fixed-rate loan, broaden your operation, or make enhancements to your property, Bankers South’s AgAmerica loans are a smart choice. Bankers South refinances loans including:

  • Commercial farm loans
  • Ranch loans
  • Equine facility loans
  • Dairy loans
  • Citrus loans
  • and more

 

Rest assured, Bankers South will find the AgAmerica loan product that aligns with the goals of your agribusiness. Plus, loan terms are flexible and the underwriting process is quick and efficient! To learn more about the benefits of AgAmerica lending, contact Bankers South.


Reasons to Refinance Your Ag Loan

There are various reasons to consider refinancing an agricultural land loan:

  • Lower monthly payments.
  • Receive lower interest rates.
  • Alter the maturity of your farm loan.
  • Options for flexible payments.
  • Change from an adjustable to fixed-rate ag loan.
  • Grow your agricultural operation.
  • Enhance your property.

 

What’s more, many traditional lenders will refuse to refinance agricultural land loans – even when they have financed an existing or previous loan. Conventional lenders continue to implement rigid ag lending requirements, thus forcing new and existing borrowers to seek refinancing elsewhere.

Some typical reasons traditional lenders refuse to refinance farm or ranch loans:

  • Schedule F Income
  • Manufactured Housing
  • Ag-Exempt Status
  • Home to Land Value Ratio
  • Ag Zoning Restrictions
  • Poor Credit

 

Through our AgAmerica Lending Program, Bankers South is well-equipped to refinance ag loans that other conventional lenders refuse. Refinancing agricultural real estate is unique from other types of conventional financing. Because Bankers South specializes in these loan types, we are aware of all the logistics and nuances involved, and are better able to cater to the needs of farmers desiring farmland financing and refinancing.

Some of the agricultural loans we offer include:

  • Commercial farm loans
  • Ranch loans
  • Hobby farm loans
  • Timberland lands
  • Citrus loans

 

Bankers South is committed to getting to know all of our customers. We are here to gain a comprehensive understanding of your business intentions, answer any and all questions, guide and inform you throughout the entire farmland financing process, and of utmost importance, discover the ag loan that is right for you.

Contact us  to be in touch with one of our knowledgeable staff members within one business day.


8 Tips for Buying Rural Property

Here at Bankers South, in our AgAmerica Lending department, we finance agricultural land loans for rural property.

Investing in rural recreational and investment property is more popular than ever. Though wildly popular, it’s important, as a buyer, to approach the process mindfully. Don’t just latch on to anything because it sounds good. Get the facts.

Here are 8 tips to help you make an intelligent purchase:

  1. Do your research: Research the market to make sure the property is not over-priced. Listed prices do not always reflect what properties are truly selling at. To be sure you’re getting a fair deal, get a local realtor involved in the process.
  2. Know the infrastructure ins and outs: Purchasing rural land can present challenges. Oftentimes, these properties are without access to city water and sewer services and may have limited or no access to electric, phone, cable television, and high-speed Internet services. Be sure to look into all of these details, including road maintenance, trash pickup, and school bus routes.
  3. Find room for improvement. Are there existing structures on the property that could be restored economically rather than building new, costly structures? Do you need to install septic systems and wells? Connect with a local contractor and approach your neighbors to determine standard well depth and septic system requirements for the specific soil conditions.
  4. Be aware of codes and restrictions. Make sure you are aware of any restrictions on the land. If there are restrictions, determine if you will deal with them and then, determine how you will deal with them. Ask yourself: How will these restrictions impact this rural property and a future sale?
  5. Get insurance rates. It may be harder to receive the coverage you need for your property outside of city limits. To get appropriate coverage, contact your local realtor or ag lending company.
  6. Know the property details. Understand your surroundings. Make sure there aren’t any potential issues neighboring you that would impact a future sale. Also, be aware of environmental factors. For example, know whether or not you are in an endangered species zone. Also, look into any previous environmental contamination from former owners. Bottom-line: Know EVERYTHING about your potential land and the land surrounding it.
  7. Budget wisely. Aside from purchase price, consider costs for maintenance and enhancements like fencing, ponds, outbuildings, new appliances, landscaping, equipment, furnishings, and general repairs when you begin to budget and finance your land.
  8. Summon the experts. Ag lending companies like Bankers South understand the nuances involved in buying rural land and design ag loan programs specifically for rural property owners. For more information on our agricultural land loan options, contact Bankers South.

5 Reasons to Invest in Timberland

Timberland as an asset has become a very lucrative means of profit for many, especially in Southwest regions of the U.S. such as Florida. Timberland holders have a great opportunity to create profit.

Why?

  1. Timberland appreciates in value, just for the fact that its land, but the added value of the timber increases the price per square foot.
  2. Timberland is a continuously appreciating asset that proves to be profitable despite national economic activity.
  3. Timberland can also be leased to sportsmen enthusiasts as hunting property. Hunting leases are a rare commodity and can be negotiated for a profitable cash flow.
  4. Timberland provides profit through its timber value; timber can be cut and sold to sawmills and different companies to produce a number of forest products, such as lumber, plywood, pulp, and paper products.
  5. The risks associated with timberland are minimal (mostly physical risks due to lack of control over the environment i.e. fires, natural disasters, pest, disease outbreaks, etc.)

 

There is no doubt that timberland is a valuable asset. However, before you invest in timberland, it’s important to be aware of the factors affecting forestland valuation. Despite its abundance, timberland has proven to be a complex asset to valuate on a short-term scale. Many underwriters have a difficult time analyzing income taxes and finding an annual value of timberland that accurately depicts the landowner’s true financial status.

The key to understanding and underwriting forestland assets is to understand the strategic way forest landowners and their management teams approach the preparation of their income taxes. The most important factors include: the way in which the property was obtained, the purpose and actual use of the property, and the way in which expenses and income are perceived. This planning strategy is complex and at times can make it difficult to recognize actual and real profits, losses, and expenses over a short period of time. There are tax considerations, cost considerations, and income considerations to determine before the true value of timberland can be assessed.

All these considerations must be reviewed before timberland loans can be approved.

If you have any questions or need additional information on timberland loans and financing, please contact us at BankersSouth@BankersSouth.com.

Based on a whitepaper by Carolina Hernandez, a Land South analyst.


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