Country Amateur Rural Financing
Before purchasing, Rural 1st encourages aspiring homesteaders to create a plan and set goals for the property.
Rural Loans For the aspiring homesteader, Rural 1st offers four loan options: Land Loans: Financing for purchasing undeveloped land for future homes, recreation or agriculture. Lot Loans: For purchasing residential lots, perfect for building a home. Construction Loans: Financing for building a new home in a rural setting. Rural Home Loans: Mortgage options designed for rural homes, including properties with significant acreage.
“ Ultimately, the type of loan depends on what you want to do with the property in the future,” Anna Young, senior loan officer with Rural 1st, explained.“ Are you going to build a house? Are you using the land for recreational purposes only? It all starts with a productive conversation with a loan officer to determine the best loan product for your needs.”
How to Qualify for Financing
To be eligible for a loan, farmers and homesteaders must meet certain criteria.
For example, a Farm Credit Mid-America loan requires a farmer to live in or have a farming operation within the territory they serve and plan to produce at least $ 500 in annual farm income.
“ We’ re committed to helping farmers access the financing they need to build and maintain thriving operations of any size,” said Book.
To qualify for a loan with Rural 1st, Young explained that there are certain factors they take into consideration, including:
Location: The property must be located in a rural area with acreage. Rural 1st does not have acreage restrictions and can work with various acreage sizes.
Land Use: Understanding the borrower’ s long-term plans for the property helps the loan officer structure the loan appropriately.
Credit Score: Rural 1st requires a minimum credit score of 700. If borrowers do not have a credit score, they also offer manual underwriting.
Down Payment: A 15 % down payment is required. Young suggested borrowers plan to save for the down payment and closing costs over time.
Other Metrics: Aside from credit score, Rural 1st also considers assets, liabilities and income, just to name a few.
“ At Rural 1st, we are a team,” Young said.“ We work together to get our farmers and homesteaders the financial products they need to make their farming and homesteading dreams come true.”
Apply for Homestead & Farming Grants
Another avenue for financing a homestead or farm is searching and applying for grants meant to finance a homestead, research efforts or production agriculture. A few options include: 1. U. S. Department of Agriculture( USDA) Grants and Loans 2. National Institute of Food and Agriculture( USDA) 3. Sustainable Agriculture Research and Education Grants 4. Organic Farming Research Foundation Grant Program 5. National Sustainable Agriculture Coalition Down Payment Loan Program
Advice for New Farmers & Homesteaders
Whatever financing option is decided on, Young stresses the importance of having a conversation, creating a plan with future goals and understanding the options available.
“ It never hurts, and doesn’ t cost you anything, to have a conversation with a lender,” she continued.“ It’ s a great opportunity for asking questions to learn how to get started, how to get pre-qualified and what your options are.”
9 AcreageLife January 2025 AcreageLife. com