By Madison, Ag Lending Group
We review a lot of financial packages, and the difference between one that moves through underwriting in a couple of weeks and one that drags for two months usually isn't the strength of the operation — it's how the information is put together. A strong farm with a messy package can take longer to approve than a modest farm with a clean one.
Start With a Real Balance Sheet, Not a Tax Return Stand-In
Tax returns tell us about profitability, but they're a poor substitute for a proper balance sheet, since depreciation schedules and cash accounting can make a healthy operation look weak on paper, or vice versa. Bring us a balance sheet listing assets at current fair market value, not depreciated book value, alongside your tax returns. The two together tell a much more complete story than either alone.
A Cash Flow Projection That Shows Your Thinking
Don't just hand over a single number for projected revenue. Show your assumptions — acres, expected yield, price assumptions, input cost estimates — so we can see how you arrived at the projection, not just what the projection is. A well-reasoned projection with modest assumptions is more convincing than an optimistic one with no visible math behind it.
A Short Narrative Goes a Long Way
One page explaining what you're financing and why, in your own words, does more work than people expect. If you're expanding into a new enterprise, explain your experience with it. If you had a rough year two years back, address it directly rather than hoping we won't notice — we will notice, and a straightforward explanation reads a lot better than an unaddressed gap.
Organize It Before You Send It
Group documents logically — financials together, entity paperwork together, collateral documentation together — rather than sending a folder of forty unlabeled files. It sounds minor, but it genuinely speeds up how fast an underwriter can work through your file, and a package that's easy to review tends to get a faster answer.
The Payoff
None of this changes whether your operation qualifies. It changes how fast we can say yes, and it gives you more leverage in how a loan gets structured, because we're working from a complete picture instead of filling gaps with assumptions. If you want a second pair of eyes on your package before you submit it anywhere, we're happy to review it, even informally, before you're deep into a formal application.
Once your package is together, start a pre-approval or see which ag loan fits your operation.
About the author: Madison grew up in agriculture, turning irrigation lines in her family's orange and almond orchard in Central California. Today she helps farm and ranch families across the country find financing that fits their operation at Ag Lending Group, a family-run farm financing advisor based in Phoenix that has been working with producers since 2016. Get in touch.
