Our goal at Lending Valley is to provide all small business owners access to the best loans possible for their business. You can rest assured we will get you the best rates in the market!
If you’re a dairy farmer who has found their way here looking for a dairy farm loan—you’re not alone.
Statistics released by the U.S. Department of Agriculture document the extent of the financial burden our dairy industry is under right now.
If you’ve found yourself in this position and need to find capital quickly—a dairy farm business loan could be a solid solution.
Or maybe you’re fortunate to have weathered the dairy storm of late, and it’s now time for your business to consolidate and improve operations—or even to expand. If that’s the case, dairy farm financing can help move your business to the next level.
Whatever your current situation, our people at Lending Valley have unpacked everything you need to know about dairy farm loans—what they are, who they are for, and how you can get started on the application process right now.
A dairy farm business loan helps farmers in the dairy sector to maintain their path through the highs and lows of dairy farm ownership, expand, or advance their operations.
The main purpose of this type of loan is to:
Traditionally, a dairy farm business loan had to be made through banks and financial institutions, which could take weeks—even months—to approve.
The new lending structure allows dairy farmers to get funding within 48 hours, giving clients a head start on their building and expansion. It also supports businesses in meeting working capital requirements.
A dairy farm loan is something you might consider if you find yourself in any of these positions:
So to answer the question: how do you know if a dairy farm business loan is right for you? If you need a loan, and you own a dairy farm—yes, a dairy farm loan could be a solid choice. The key is to work with a reputable lender.
Fortunately, the experts at Lending Valley know exactly what to look for when it comes to finding short term financing for our clients.
There are three factors we need to understand when we look at the financing requirements for dairy farm businesses. These establish how much your business can afford to borrow, and on what terms.
Dairy farm owners might require a loan for several reasons:
Agricultural businesses are more vulnerable to seasonal, market, and income fluctuations. A loan can be a solid option to cover a short-term financial dry spell, especially where you can demonstrate your income is likely to increase at a certain point in the future.
Marketing and branding can be crucial to a business. Public perception is also an integral part of the success of a business, so you may want to take out a loan to cover a marketing campaign or public launch.
Opportunities don’t always show up when we expect them. Part of being involved in the agricultural industry is understanding market drivers, and trends—and being ready to capitalize on those trends. If you find yourself caught short financially, emergency funding can help you capture your share of the market at short notice.
We’ve been working with clients from the agricultural sector for a long time now. We understand that often, clients need to seek financing to deal with changes surrounding the care or housing of livestock—including vaccinations and medical treatments, feed requirements, etc. These aren’t cheap, and sometimes you need to respond quickly to changes to be compliant with local or federal regulations. Drought, heavy rains, storms, and other adverse weather conditions can also affect your housing and care needs. On top of all this, you may just need to increase your herd size.
Dairy machinery is expensive, but it is a major driver behind your productivity as a business. Management software, stock monitoring, automations, milk processing equipment, storage, separators, pasteurizers—the costs add up. At the same time, eventually, this type of equipment might need replacing or repairing. At times like this, a dairy farm loan can help ease on-farm stress.
You might be a new business, purchasing real estate to venture into dairy farming. You might be an established name in the game, looking to expand your operations and increase farm productivity.
Which of these resonates with you will influence the kinds of questions your lender might ask. Some that you might need to be prepared for are:
The collateral you offer is effectively a guarantee on your ability to service your loan.
Your collateral could be what you want to purchase—in the case of real estate, equipment, or livestock—or other assets you own. Collateral is calculated as a value.
Influencing your collateral is your net worth.
Your assets vs. liabilities—which all business owners should be able to call to hand quickly—are a snapshot of where your business is positioned at any given point. This gives your prospective lenders an idea of where your business sits and helps us look at ways we can tailor a financial solution to you, specifically.
Your cash flow will be the amount of money expected to be earned by your business, fewer expenses, less the potential loan repayments.
It looks like this:
Cash flow = income – (expenses + loan repayment)
Basically, it is the expected ‘salary’ of your dairy farm over the term of your loan.
There are several areas of your business that you can analyze to help you establish this figure clearly.
Finding a strong mentor or business analyst can help you to analyze stock performance, monitor trends, and examine feed conversion, longevity, and disease management. In short, they help you to achieve greater success as a dairy farmer.
Our expert team at Lending Valley source the best loan for your dairy farm based on the information you can give us. The terms of each loan type can vary, and the options that are available for your business will depend on the factors we’ve listed above.
Generally speaking, the interest rate and loan repayment terms will depend on the amount you want to borrow, the lender, and your specific circumstances. Your business track record and financial history can also influence a special interest rate or term.
The options available are presented to you clearly before you sign the dotted line, and we’re here to work with you every step of the way.
We outline the interest rates of each type of financing, the repayment terms, and can outline the benefits of each type. Our people work to make sure you find the finance option that best suits your business needs.
Securing a dairy farm business loan is fast and simple, when you know where to look. Fortunately, you’re already in the right place.
To get your loan application rolling right now:
There you have it—a dairy farm business loan approved and in your account in no time. It really is that easy with Lending Valley’s in-house experts. There’s no need to waste days, weeks, or months of your time. Invest that time in your dairy farm, and let us do the groundwork for you.
Being a part of the dairy farming industry can be challenging and stressful—but our clients say it is also an incredibly rewarding business that makes your hard work worthwhile. Our goal is to support you through the challenge of a financial shortfall, using all the finance and lending expertise we’ve got.
We can answer questions on loan types, find the best deal for you, and in the shortest amount of time. It takes a deep understanding of finance and the agriculture industry to get this right every time, and it gives us immense satisfaction to serve hundreds of clients who have been where you are now.
If you’re ready to take the first step in achieving your next goal, Lending Valley wants to be on your side.
Ready to go? Click here and we’ll walk you through submitting your loan application.
