FBN® Finance

Frequently Asked Questions

Ag Real Estate Loans

Loans can be made on a monthly, semi-annual, or annual basis. Prices shown here are based on semi-annual payments. Annual payments increase the interest rate by 0.15%.

No. There is no prepayment penalty for refinancing or paying the loan off before it’s due.

Your loan will include title, appraisal, and origination fees. In most cases, these fees are less than 1% of the loan value and can be added to the loan itself, so you won’t have any out-of-pocket costs at closing. Title fees and appraisal fees are passed on to the applicant at cost.

If you have a current land appraisal that is less than one year old, you may be able to reuse it, subject to Farmer Mac’s guidelines. FBN’s origination fee varies by size, but will either be 0.65% or 0.3%.

You will work with one of our Loan Advisors as well as our team of credit analysts and loan closers.

While we work with Farmer Mac to provide the financing, we will be your “Field Servicer.” This means we will be your first point of contact for any issues you have with the loan.

Operating Lines

Yes — all of our operating lines are revolving.

We offer fixed rates for amounts of $1 million or less, and variable rates for amounts greater than $1 million.

Advances are made through an ACH or wire request in which funds will be electronically transferred.

Funds can be transferred into your account in as little as two business days after they’ve been requested.

FBN’s name is not on grain or crop insurance checks.

Depending on what the farmer is approved for, the operating lines are secured by crops, crop proceeds, and crop insurance, or a blanket lien on all farm assets.

The operating line can be used for any agricultural-related operating expense, including inputs, rent, labor, and short-term equipment, subject to certain limitations set forth in the operating line agreement.

Our loan amounts range from $100,000 to $5,000,000.

The maturity date is February 1, 2023 or March 1, 2023 depending on the program. If you typically store your grain to market later in the year, we can work with you next winter to extend the line past this date. 

Most borrowers who are approved have a 680 or above credit score, although there may be exceptions where a lower score could be approved. We also factor in repayment history, the size of your loan relative to your income and operations, and the general financial health of your operation. 

Equipment Loans

We generally require a 20% down payment.

The minimum loan amount is $10,000 after taking into account the down payment.

In order to receive equipment financing the equipment must be newer than 14 years old.

Generally, we’re able to extend financing to businesses that are more than five years old, with good credit ratings, using funds for agricultural production equipment.

Most commonly we finance tractors, combines, forage harvesters, application equipment (such as sprayers and floaters), windrowers, balers, irrigation equipment (center pivots), implements, skid steers, semi tractors, and grain trailers.

Farmland Capital

No.

No — participating with Farmland Capital won’t affect your deed. We file a memorandum which states that the investment is structured as an option and secured by either a mortgage or deed of trust.

No, FBN Finance is providing farmers the capital they need to support their operation. The goal of this investment is for the farmer to buy out of the agreement after 3-10 years after they have built more equity in their operation. FBN is not buying whole parcels of land or competing with farmers to buy land.

No — there are no interest or rent payments as part of the agreement.

You can buy out of the co-investment agreement at any time.

The land is valued by either a certified appraisal or market price.

Investments begin at $100,000 and can go up to 49% of your farm’s equity.

Farmland Capital is available to current and retired farmers.

Yes.

While you’ll be interacting with FBN Finance over the term of the agreement, the funding will typically originate from a range of investors including wealthy individuals, family offices, endowments, foundations, pension funds, and other farmers.

Our typical investors view Farmland Capital as an opportunity to make a longer-term investment (up to 10 years) in US farmland. Farmland investments help investors hedge against inflation, diversify their investment portfolios, and support American family farmers.

Farmland Capital investors don’t collect rent payments, and they cannot control when their investment is returned. They experience gains and losses alongside the farmer (with the potential to lose all of their investment if the farm’s value drops significantly). To compensate for these risks, investors are targeting an annualized return of 10% over the life of the agreement.

Still Have Questions?

Give us a call to speak with a loan advisor.