2020 Financial Planning: Alternative Lending as a Financing Source for Your Farm Operation

Alternative Options to Traditional Agricultural Loans.

According to the U.S. Department of Agriculture (USDA), farm debt will hit a record high of $416 billion by the end of 2019. Farmers are leaning on lenders now more than ever, not just during the hard times, but to finance new opportunities like farm expansions, equipment updates, and more. So why are farmers choosing alternative lending companies to help open these doors?

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3 Tips for Buying a Ranch Farm

Learn how to mindfully approach choosing and purchasing a ranch farm

Owning a ranch farm can be a very exciting and fulfilling experience, especially for those looking to pass the ranching traditions on to the next generation. However, it’s not an investment to be taken lightly — owning a ranch comes with a lot of responsibility.Read More

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Must Ask Questions When Buying Ag Land

Know how to best serve your family ag operation.

Most farms and ranches in the U.S. follow the traditions of family farming and ranching. These operations require a lot of land, and we’ve looked at how owning land is the best option, especially for families that are looking generations into the future.  Let’s take some time to look at buying that land. Preparing for the future often includes expansion, so it’s important to know how to buy farmland. Explore the questions you should ask when buying agricultural land, gleaned from an AgAmerica Lending piece on GrowingAmerica.com, below.Read More

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Coaxing More Cash Out of Your Ag Land and Farmland Loans

Read expert tips on making the most of the tax benefits associated with your ag land and farmland loans.

In a recent article, we polled the tax experts for tips on making the most of the tax benefits associated with agriculture. Whatever type of agriculture you’re involved in, land is one of your most critical and necessary investments. The question is, are you really doing all you can to make the most of the tax benefits associated with your land in order to help manage your income? Farmers, like all businesspeople, need as many tax breaks as they can get each year to help make ends meet. We looked into some key tax benefits every farmer should consider, and recently spoke to two CPAs for their guidance and perspective. Find more on farmland loans, and the link to the full article for all the advice from the experts, below.
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Government Shutdown Delays USDA Farm Loans

In response to the government shutdown, the U.S. Department of Agriculture (USDA) has closed its operations, thus costing many farmers their farms and farming dreams.

As of now, the general public can’t even access the USDA’s website for information regarding funding and farmland loans:

“Due to the lapse in federal government funding, this website is not available. After funding has been restored, please allow some time for this website to become available again.”

Many farmers have already been waiting months to receive government farm loans, including USDA direct farm operating loans, direct farm ownership loans, and guaranteed ownership loans. This shutdown will prolong the waiting game for 1,800 of the approximately 29,000 farmers expected to receive USDA farm loans this year. These delays, resulting from the government shutdown combined with the fact that Congress has yet to pass a budget, will likely cause many farmers to lose their farms or let go of their farming dreams. It’s clear that the path to receiving a USDA farm loan will be a long, taxing, and unreliable one for many farmers. Congress really needs to pull through with a budget.

It’s evident that farmers are in a somewhat hopeless state of affairs due to many issues beyond their control. Stress and uncertainty abound, as they do their best to deal with these delays and doubts. Delays can be just as damaging to farmers as not receiving ag loans at all. For example, maybe the farmer isn’t able to invest in crops or farm equipment in a timely fashion. Time is often of the essence in the agricultural industry. As Congress continues with its indecision, farmers will continue dealing with consequences.

In the throws of this government shutdown, it may make sense to seek funding elsewhere. Agamerica Lending offers non-conventional agricultural land as well as conventional ag loans. These farm loans come in handy when borrowers are facing special circumstances. It never hurts to explore your farmland financing options. Contact us to see if we can meet your financing needs. 

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Cotton Crop Yield Expected to Fall Below Average

Cotton crop yield in Southeast regions – Georgia, Alabama, and Florida – is projected to fall short of previous yield forecasts. But how short? Is it enough for cotton growers to worry?

So far, there is not a concrete answer in response to the yield question. However, while an actual yield prediction has not been ascertained, it is still enough to cause many cotton growers to worry.

What’s the culprit for the probable low yield?

The uncontrollable: Weather.

Various environmental factors were working against the cotton crop this season.

Heavy rainfall prevented cotton growers from planting on schedule. Storms caused excessive fruit shed. Cooler weather stunted growth, even preventing some plants from maturing. Finally, excess moisture created a friendly environment for fungal proliferation.

To counteract this unanticipated fungal growth, cotton growers applied fungicide to battle the fungus causing target spot.

There is great debate on the extent that target spot impacts cotton crop yield. While target spot is perhaps a factor resulting in this year’s projected low yield, heavy storms, which knocked off many plants, are probably the more likely explanation for low cotton yield.

While some of the cotton is still prospering (resulting from late planting), it is quickly running out of optimal 60-degree weather days as the fall season is just around the corner.

As for the final yield assessment, growers will not know for sure until harvesting is complete.

The good news? The cool, wet conditions may allow dry-land cotton to do well compared to previous years.

Are you a cotton grower in Georgia, Alabama, or Florida? If you’d like to discuss your farmland financing options – including agricultural loans and ag farm credit – contact Bankers South Lending & Finance, LLC.

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Good News for Young/Beginning Farmers

Oftentimes, farm loans are difficult to access for young or beginning farmers. Many agricultural loan programs have proven effective in financing farmland – FSA (Farm Service Agency) loans for example – yet now there is an additional, promising solution.

With the Senate passage of the Farm Bill, also came the potential for a new amendment – the Casey-Harkin-Johanns Microloan Authorization Amendmentthat offers young and beginning farmers up to $35,000 to get their agricultural operation up and running. This amendment has the power to allow young and beginning farmers to get the ball rolling and offers a plan to effectively realize their number one biggest concern: financial capital to start and sustain their farm businesses.

The Casey-Harkin-Johanns Microloan Authorization Amendment offers new and beginning farmers promising potential including:

  • Less heavy paperwork
  • An extended payment period
  • Low-interest farm operating loans for military veterans
  • A quicker turnaround in profit (fingers crossed!)

To be eligible for such government backed farm loan programs you must classify as a beginner or new farmer. To qualify you must:

  • Have not operated a farm or ranch for more than 10 years
  • Not own a farm or ranch greater than 30 percent of the median size farm in the county as described by the most recent Census for Agriculture
  • Meet the farm loan eligibility requirements of the program to which you are applying
  • Heavily participate in the farming operation

The number and types of farmland financing programs vary for new and beginning farmers. It’s good to be aware of your options so you’re able to get the farm loan that’s best for you and your farming operation. Sometimes, however, a government backed loan isn’t going to cut it. If you’re not able to acquire a government backed loan – USDA loans or FSA loans – or if these ag loan programs are not a good fit, contact us to determine a better solution. A part of our focus and concentration is getting beginning farms, ranches, and young producers the agricultural loans they need to get started with their business.

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