Farm land lenders are conservative, but they are not opaque. Once you understand what they need, the process is largely about presenting a clean package and pointing it at the right capital source.
Borrower documentation
- Three years of personal and entity tax returns, including all schedules.
- A current personal financial statement (most lenders provide their own form).
- Two to three years of farm operating financials if it is a working operation.
- Schedule of real estate owned with debt, equity, and current market values.
Property documentation
- Legal description, plat or survey if available, and title commitment.
- Aerial maps showing tillable acreage, pasture, timber, and waste.
- Soil maps and productivity ratings (NCCPI or state equivalents).
- Water rights documentation, if irrigated.
- Lease agreements, if cash- or share-rented to a third party.
Credit and capacity benchmarks
Most farm lenders look for FICO scores in the 700s, debt-to-asset ratios under 50%, and a debt-service coverage ratio of at least 1.20x — usually higher. They underwrite to long-run normalized commodity prices, not the spot market.
Collateral expectations
Loan-to-value is typically 60–75% on farm land, with 65% being a common middle. Lenders may require a first lien position on the land, and on larger transactions they may ask for additional collateral — equipment, additional real estate, or assignment of cash rents.
