Farm finance
Costs come all year, but income often arrives with a harvest or a sale. Here is how finance is commonly used to match money to the season.
How money moves in farming
On many farms the big costs come months before the income: seed, fertiliser, feed, fuel and wages are paid long before a crop is sold or stock goes to market.
Finance is often used to bridge those months, to buy machinery and stock, and to buy or improve land. Repayments can sometimes be set to fit the season.
Finance commonly used
- Seasonal or working capital finance: covers running costs until the harvest or sale is paid.
- Equipment finance: for tractors, headers, utes and other machinery, usually with the machine as security.
- Livestock finance: for buying stock, repaid as the stock is sold.
- Rural property loan: to buy, refinance or improve land, usually secured by the land.
Documents usually asked for
- Recent financial statements or tax returns
- Bank statements for the farm business
- A seasonal budget or cash-flow plan
- Details of the land, stock or machinery offered as security
- Quotes for the machinery or stock you want
- Supply, buyer or lease contracts, if you have them
Every lender decides what it needs, so you may be asked for more or less. The document checklist builds a list for your type of finance and country.
Free tools that help
They work in your browser with your own numbers. Nothing is sent or saved.
- Cash-flow planner 12 months of money in and out, with the short months marked.
- Seasonal repayment schedule a loan repayment split between harvest months and the off-season.
- Crop input planner input costs, finance to harvest and break-even price.
- Livestock purchase planner total cost, finance interest and margin per head.
- Machinery replacement planner keeping an older machine compared with financing a new one.
Good to know
- Words used on this page: seasonal finance, working capital, secured loan, LVR, bridging finance.
- This is general information about how finance is often used in farming. It is not financial, legal or tax advice, and it is not a promise that any lender will approve an application.
- Read Before you borrow for the questions to ask any lender, and see other industries.
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