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Ag Lending With Options: How Bankers South Tailors Loans to the Needs of the Ag Community

By Dale M. Johnson

While growing up in DeSoto County, my dad had a saying about paying back a loan, “You can always pay more if you can, but they frown on you if you want to pay less.”

I thought of that saying when I recently came on board as the senior vice president at AgAmerica Lending. Most lenders have loan programs with rigid payment schedules and lines of credit with few options. AtAgAmerica Lending, we feel as though we are on the same team as the client and continually look for alternate ways to meet their financing goals.

Our AgAmerica “conventional” financing program is really second to none. Our programs are structured with the farmer and rancher in mind. Our 15-year balloon loans, with a 25-year amortization, are structured so that once the loan closes the client does not have to worry about going through the process again for another 15 years. This is compared to most lenders who want you to come back in to rework the loan every 36 to 60 months. Our 25-year amortization means your payments are spread out evenly over 25 years. Most lenders will only spread the payments out between 10 to 20 years. Our 25-year amortization means your annual debt service will be much less.

Allowing for a lower annual debt payment allows the client to make decisions that are best for the overall operation as opposed to making a decision due to an aggressive debt repayment schedule. Another major difference is the interest rates that are available. We do not have a “floor” on our variable rate products. For example, based on this week’s rate, the interest rate on our one-month LIBOR product for those who qualify is 3.2%. There is no interest rate floor so we pass the great rate on to the client. We allow the client to choose either monthly, semi-annual or annual payments depending on which schedule works better with their operation.

Our Revolving Line of Credit program can be set up for a draw that lasts five or 10 years, and we do not require you to “rest” the loan at any time during this period. Can you imagine not having to zero out the line of credit balance over the next five or 10 years?

It all starts with a phone call. A quick call to our Lakeland office will start you well on your way.  Generally, we take your basic contact information, along with the best time to call or meet with you. A loan officer will schedule the time around your schedule. We underwrite the file in-house and then meet with you to discuss the available financing options. When you are comfortable with the terms and costs of the application, the file is submitted to an underwriter for final approval. Once we have the preliminary loan approval, we obtain title and appraisal, then move towards closing and funding your loan.

Finally, and most importantly, is that I believe AgAmerica Lending treats the client with respect by reviewing the individual’s financial information in a timely manner and being accessible for questions, comments, or suggestions, even if it is after hours.

To discuss your land loan needs, contact or at our office at 844-516-8176.

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What is a Hard Money Loan?

florida-timberland-loanA customer called AgAmerica Lending not long ago with a problem. He was coming close to a foreclosure on a tract of timberland. He wanted to sell off the tract, but not under distress in a fire sale, where he might lose his shirt.

Our loan specialists had the plan to buy him some time: a hard money loan. Instead of losing the property, he had time to put it up for sale, wait for the right buyer, and was able to walk away with a profit. He was elated, not only because he retained the equity built up in the land, but also because his credit was not ruined. We were proud that he was able to get out from underneath a bad loan – and we were happy to help him stand tall in a tough situation.

Hard money lending, or private lending, is often misunderstood. Put simply, a hard money loan is an asset-based loan. Some people wrongfully believe that hard money borrowers are in financial trouble, when actually these types of loans were the original way to borrow money. In the 19th century, it was near impossible for a lender to verify a borrower’s income, so all mortgages were asset-based loans. Over the decades, as banks competed for business, lenders slowly began evaluating borrowers’ abilities to repay the debt according to their income, instead of just looking to the value of the collateral.

Nowadays, since institutional banks look more to a borrower’s ability to repay the loan and less to the asset itself, hard money lenders have a place again in the market. Hard money lenders like AgAmerica Lending are there to help not just those in financial trouble, but any borrower who has enough equity in an asset. Hard money borrowers are often stable, successful businesspeople that just happen to find themselves with a need not met by a traditional bank loan.

Some of our borrowers are in need of a short-term loan, say a few weeks or six months, to “bridge” them over to a new project or goal. Others are behind in their current payments and need a “loan buyout” from an institutional bank. We’ll often take over their loan and restructure the payments to more manageable levels. We can help our customers sell their property too, through our real estate brokerage division, Land South Realty. These hard money loans have seen our customers through the tough times, often allowing them walking money after the sale, and everybody is happy.

Our entire team at AgAmerica Lending is knowledgeable and experienced in real estate valuation. Due to this experience, loan underwriting and property appraisal are completed in a timely fashion. Depending upon the type of loan, funding can take as little as one to three weeks. If you think a hard money loan could work for you, we’re standing by to help you through the process. Contact us at 844-516-8176 or write us an email at

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