Working capital loans are for longer term assets, such as machinery, breeding stock, building renovations and additions. Lenders may call these intermediate-term loans, and they are often for five to seven years. Security is usually a mortgage on the personal property financed. Long-term loans are usually for funding of land and buildings. Farmers often use them for major real estate improvements and to consolidate other loans.
Security is usually a lien on the real estate of the operation.
The activity and availability of the lenders interested in agriculture loans varies substantially in Missouri. For this reason, and because their programs are constantly changing, the following will be more of a directory than a description. The Farm Credit Service lends to farmers through local cooperative associations chartered by the federal government. You join the cooperative and buy stock with your loan. The plan is to help the borrower to succeed to the point where other conventional lenders can take over part or all of the financing.