An agricultural loan is for those in the business of farming and agriculture. There are many different outlets for funding agricultural loans, include government programs, commercial banks, and credit unions. There are also farming associations and groups which may be able to help secure financing.
Before applying for any agricultural loan, it is important to have a thoroughly written business plan. The business plan should include information about: the business you plan on starting, the finances you need, why you need them, and what they will be used for, the current market, and projections. This business plan will help lenders see how serious you are about starting the farming business and play a role in whether or not you get funding.
Before looking into commercial loans, 37 states in the United States have sate funded financing programs from agricultural loans. Contact the state you live in to find out more information about what they can do to help you. Another place to consider is the United States Department of Agriculture, otherwise known as the USDA. There are grants available to help farmers sell their businesses to younger family members, expand their business, and keep their business up and running.
When running your farming business, it is essential to keep good records of all financial transactions. All lenders will want to see the financial records of the farm to show how much money it makes and how much it spends. This will help them determine whether or not the risk is worth it. If you say you sell a certain amount in inventory, you should be able to back it up with bank statements and sales receipts.