About Farm Loans
Types of Farm Loans
Farm Ownership Loan: For purchasing farmland, buildings, or making improvements.
Operating Loan: For seasonal expenses, operating costs, and working capital.
Equipment Loan: For purchasing farm machinery, tractors, and equipment.
USDA-Guaranteed Loan: Government-backed loans with lower down payment requirements.
Credit Union Farm Loan: Offered by local U.S. credit unions, often with competitive interest rates and flexible terms.
Poultry Farm Loan: Specialized loan designed for poultry or livestock operations, covering feed, housing, and equipment.
Typical Terms
- • Interest rates: 5% - 8% depending on loan type
- • Terms: 5-30 years depending on purpose
- • Down payments: 0-15% depending on loan type
- • Land tax rates vary by state (0.5% - 2.5%)
Regional Considerations
Iowa Farm Loans: Commonly used for corn, soybean, and livestock operations; property tax and operational costs vary by county.
Other U.S. States: Loan terms and tax rates differ; use local averages as a reference when calculating monthly payments.
Land Tax Considerations
State Variations: Land tax rates vary significantly across U.S. states:
- • New Jersey: 2.21%
- • Illinois: 2.05%
- • Texas: 1.80%
- • California: 0.75%
- • Florida: 0.83%
- • Washington: 0.92%
- • Iowa: 1.53%
Why Use a Farm Loan Calculator?
- • Understand total borrowing costs including land taxes and insurance
- • Compare different loan types such as USDA, credit union, and equipment loans
- • Plan cash flow and repayment strategies for specific operations like poultry or crop farming
- • Make informed financial decisions for regional farming operations in Iowa or other states
Calculation Formula
Principal: Loan Amount - Down Payment
Periodic Payment: Principal × [Rate × (1 + Rate)^Periods] ÷ [(1 + Rate)^Periods - 1]
Periodic Land Tax: (Loan Amount × Land Tax Rate) ÷ Payments per Year
Total Payment: Periodic Payment + Periodic Land Tax + Periodic Insurance / Fees
Estimates only. Actual payments may vary based on lender terms, local land tax, insurance, and farm type.