by Sanne Kure-Jensen
How does a beginning farmer secure their first farm loan? A farmer may wish to purchase equipment using a loan instead of taking on expensive credit card debt for cash flow until harvest brings cash. Most lenders seek similar business information to analyze when considering beginning farmer credit worthiness.
Short-term loans are used to finance seeds, fertilizers and/or other annual inputs. This can include cash to help farmers pay their farm and/or personal bills between harvests. Short-term loans are under a year and are repaid after harvest. Intermediate-term loans help farmers purchase capital equipment like tillers, tractors, coolers and have repayment terms up to seven years. Long-term loans for farmland may extend to 30 years.
Gary Matteson of the Farm Credit Council and Benneth Phelps of the Carrot Project shared their recommendations on planning for obtaining credit in a workshop for beginning farmer educators at the Beginning Farmer Learning Network Conference in late 2014. [Read more…]