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Family Farm Loan Program
The North Dakota legislature has developed a program to help family farms. This program allows BND to participate in loans for qualified purposes up to 90% of the loan amount.
Qualifying Requirements
Borrower - A borrower is a "farmer" who is a resident of the State and
is at least eighteen (18) years old. The applicant has had the farming experience and training necessary to enable the applicant to operate a family farm and to make proper use of the proceeds of the loan.
Net Worth - The net worth of the applicant does not exceed $500,000.
Local Lender - A local lender is required to initiate the loan participation
and is responsible for servicing the loan.
Use of Proceeds - BND participates in loans in the following categories:
- The purchase or the refinancing of agricultural real estate.
- The purchase of a home-quarter under N.D.C.C. Chapter 6-9.10.
- Permanent improvements to agricultural real estate.
- The purchase or refinancing of farm equipment.
- The purchase or refinancing of livestock.
- The restructure of operating debt carryover.
Collateral - The collateral used to secure the loan will depend upon the intended use of the proceeds.
Real Estate - A first lien on the real property which is the subject of the loan as well as an assignment of rents is required. In addition, an acceptable appraisal of the property, is required.
Equipment or Livestock - A first lien on the equipment or all livestock of like kind. In addition, an acceptable appraisal, is required.
Application Process
Application by a lead lender is required for BND's participation. See application for additional documentation required when submitting
a request to BND. Lead lender is responsible for servicing of loan.
Interest Rate
The interest rate on BND's percentage will float at 1% below BND's base rate. However, at no time will the interest rate exceed 11%.
The maximum interest rate on the lead lender's percentage shall not exceed BND's base rate plus 3% and may float.
Repayment Terms
Real Estate Loan
- 20 year maximum loan (amortization schedule may be longer).
- Total loan not to exceed 75% of appraised security value.
- Must be first mortgage.
Farm Equipment Loan
- 7 year maximum loan.
- Total loan not to exceed 75% of appraised security value.
Livestock Loan
- 7 year maximum loan.
- Total loan not to exceed 75% of appraised security value.
Restructure of Operating Debt Carryover
- 5 year maximum loan.
- Total loan not to exceed 85% of appraised security value.
- All available security must be pledged.
Loan with FSA Guarantee
- Loan not to exceed term of guarantee.
- Total loan not to exceed 90% of appraised security value.
Loan to a borrower for the purchase of livestock and/or livestock related equipment who is participating in a program of supervised technical and management assistance approved by BND.
- 7 year maximum loan.
- Total loan not to exceed 90% of appraised security value.
Total Loan Amounts
There is no total loan limitation. BND's participated share is limited
to the lesser of $400,000 or 90% of the total loan amount.
Fees
There is no origination fee charged by BND.
For more information about this program or other Bank of North Dakota programs,
contact:
Bank of North Dakota
1200 Memorial Hwy
PO Box 5509
Bismarck, ND 58506-5509
(701) 328-5624
1-800-472-2166 ext. 5624
TDD (Telephone Device for the Deaf) 1-800-643-3916
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