Credit Guidelines

General Guidelines for Our Agricultural Loans

AGRIfinancial Services offers loans and leases to credit-worthy borrowers. Our intent is to provide constructive financing that will improve the long term profitability and viability of an operation.   Here are some general credit guidelines or standards that we look at when considering an application:

LOAN TO VALUE RATIO - The maximum amount of the loan will not generally exceed 70% of the value of the property. Based on the lessor of either the purchase price or appraised value.  

DEBT TO ASSET RATIO – The customer will have not more than 50% debt on total value of the operation.

DEBT COVERAGE – Customers will produce $1.25 dollars of income from their operation for every $1.00 of annual debt servicing (principal and interest).

CURRENT RATIO - Customers have liquid assets (within 12 months or 1-year operating cycle) that are equal to or greater than the amount of short term debts outstanding.

PROPERTY DEBT COVERAGE - 1.00 to 1.  Net income generated by the property (used to secure the proposed loan) must be greater than or equal to the annual amortized payment on the loan.

CREDIT SCORE - Credit bureau scores of 660 and better are considered.

These credit standards are applied in considering every request for a loan or lease. Guidelines are just that.  Sometimes a customer’s financial position will show a weakness in one standard that can be offset by strengths in others. In applying standards, our underwriters look for strengths that enable them to say yes.