Maine Farmer Resource Network

Financing Your Farm Business

Careful financial planning, building relationships with lenders and investors, and understanding the financial resources available are keys to successful financing for your farm. Financial planning involves understanding your income and expenses for your family and business, and getting real estimates for needed changes, purchases or upgrades to your business. Building relationships requires an understanding of the 5 Cs of credit (Character, Capital, Capacity, Collateral, and Conditions) as well as getting your potential lender out to the farm to better understand your business and financing needs.

Understanding the financial resources available takes time and effort. Where to find lenders who both understand farming and appreciate the challenges and risks inherent to running a farm business is not easy. Start with evaluating your own capital resources, followed by local credit unions and banks you currently do business with. Then broaden your search with the resources listed below.

General Resources on Financing your Business

In 2018, the Maine Department of Agriculture, Conservation and Forestry developed a series of factsheets for each of Maine’s counties and the three sub areas of Aroostook County:

  • Factsheet 1 – Connect for Success in Androscoggin County
  • Factsheet 2 – Androscoggin County – Looking for Lending for your Agricultural Business?
  • Factsheet 3 – Looking for Lending in Androscoggin County?
  • Factsheet 4 – Looking for Alternative / Non-traditional Lending Sources?

These are packaged online as a single Androscoggin County Resources factsheet packet (PDF).

Alternative/Non-Traditional/Non-Regulated Financial Institutions (CDFIs, NGOs, CDCs)

Several institutions have various programs which might serve your needs. They have slightly different requirements than traditional sources of capital, and sometimes can work in conjunction with your commercial bank.

Please check the Androscoggin County factsheet packet (PDF) for more information, or for other counties please visit the Maine Department of Agriculture, Conservation and Forestry webpage.

State and Federal Agency Loan Programs

State and Federal agencies have various development programs that have financing available, and typically work with commercial and alternative financing agencies to make a deal work.

State Agencies
Loans
Grants
Federal Agencies
Loans: United States Department of Agriculture (USDA)
 Grants: United States Department of Agriculture (USDA)
  • Commercial Lenders – It is always worth talking to local lenders first and establish a working relationship whenever possible with their commercial lending teams. Some banks are more favorable towards agricultural lending than others, but you will never know how active a bank is in the agriculture sector until you have the conversation about your farm business needs with each lender. You can find resources for Androscoggin County above in the factsheets, or for other counties you can visit the Maine Department of Agriculture, Conservation and Forestry webpage.
  • Farm Credit East – the leading farmer cooperative bank in Maine that does a significant portion of lending to the agricultural community in Maine.
  • FarmStart is a Farm Credit East program that makes working capital investments of up to $75,000 to agricultural ventures showing promise of success. Intended for Ag businesses in their first 3 years of business.

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Direct Your Inquiries:

If you represent an agency or institution that works with Maine farmers and are interested in presenting to MFRN, please contact Tori Jackson, Chairperson, at tori.jackson@maine.edu.