The Bank of Frankewing can assist with the purchase or refinance of beef cattle, stocker cattle, dairy or other livestock. Livestock loans can be structured in different ways, depending on the type of livestock being financed. The loan terms will range from a short-term grass feeding or backgrounding herd, to longer terms for breeding livestock. The repayment on these loans will be structured to match the cash flows of each particular herd.
Crop loans are typically a done as a line of credit to cover the expenses that are involved in the planting and raising of a particular crop. In our area, the most popular crops harvested are soybeans, corn and wheat. A crop loan allows a farmer to make draws and then pay the loan off when the crop is harvested and sold. The cycle or term of these loans is usually 12 months and the collateral is the actual crop being harvested.
A line of credit is a loan that allows you to draw money as you need it, up to the credit limit. These types of loans can be paid down and then drawn back up, depending on the structure of the line of credit, similar to a credit card.
Lines of credit are designed to meet short term working capital needs or cover operating expenses. For example, purchasing fertilizer, chemicals, and feed might be a good temporary use for this line of credit. Collateral and repayment terms are typically tailored to meet the needs of your farm and its cash flow cycle, but quarterly interest payments are required in most cases.