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Missouri Ag Lending 101: What You Need to Know Before Applying for a Loan
November 5, 2025
If you farm in Missouri, whether you’re planting your first crop, expanding acreage, or taking over the family operation, you already know that success depends on timing, hard work, and the right support. When it comes to financing, finding a lender who truly understands agriculture can make all the difference.
At Peoples Savings Bank, we’ve been supporting local farmers and rural communities across Missouri for more than 90 years. Our ag lenders live here, farm here, and understand the unique challenges you face. Here’s what every farmer should know before applying for an ag loan, and how to make the process smoother from start to finish.
Why Ag Lending Is Different
Agriculture isn’t like other industries. Crop cycles, weather patterns, and market volatility all affect how and when income comes in. That’s why ag lending requires a different approach.
Here’s what sets ag loans apart:
- Seasonal cash flow: You don’t earn year-round; income often comes once or twice per year.
- Collateral: Land, equipment, or livestock require special valuation.
- Risk factors: Weather, input costs, and commodity prices can fluctuate wildly.
- Long-term planning: Ag loans often span multiple years (or decades), requiring flexibility.
A good ag lender knows this. They’ll structure your repayment schedule around your production and harvest seasons, not just a standard monthly calendar.
Common Types of Ag Loans
Before applying, it’s important to know what kind of financing you need. Each loan type serves a different purpose, from short-term working capital to long-term land purchases.
1. Operating Loans
Used to cover day-to-day or seasonal expenses such as:
- Seed, fertilizer, and feed
- Equipment repairs and fuel
- Family living expenses during the off-season
Typical term: Less than one year (often structured as a line of credit).
Tip: Keep detailed records of your yearly input costs to show the lender how funds will be used.
2. Equipment & Machinery Loans
Perfect for replacing or upgrading your equipment: tractors, combines, irrigation systems, or milking machines.
Term: 3–10 years, depending on depreciation.
PSB tip: Compare equipment lifespan and loan term carefully. You never want to still be paying for a piece of equipment you’ve already replaced.
Apply for an Equipment & Machinery Loan
3. Farm Real Estate & Land Loans
For buying or expanding farmland, refinancing existing loans, or improving property with new buildings, fencing, or irrigation.
Term: 10–30 years, often with flexible repayment schedules.
Collateral: Usually the land itself.
Apply for a Farm Real Estate & Land Loan
4. Beginning Farmer Programs
Missouri offers several programs designed for first-generation or young farmers:
- Missouri Beginning Farmer Loan Program: Helps new farmers purchase land, breeding livestock, and equipment at lower interest rates.
- Down Payment Assistance Programs: Combine state funds and lender financing to make starting out more affordable.
Your PSB lender can help you navigate these programs and see if you qualify.
5. Agribusiness or Value-Added Loans
If you’re expanding beyond production, like processing goods, creating a side agribusiness, or opening a farm-to-table venture, specialized funding may be available through Missouri’s Agribusiness Revolving Loan Fund.
Example uses:
- Buying processing equipment
- Constructing storage or packaging facilities
- Marketing and distribution
6. Disaster and Emergency Loans
When floods, droughts, or severe storms hit, USDA and FSA programs can help restore losses.
Your local lender can connect you with these options and help ensure you have access when you need it most.
Learn More About USDA & FSA Programs
What Lenders Look For
Knowing what your lender will evaluate helps you prepare and build confidence going into your application.
- Financial history: Credit score, debt-to-income ratio, and repayment history.
- Farm business plan: Your goals, strategies, and expected production.
- Cash flow and projections: Lenders want to see how you’ll generate income and repay.
- Collateral: Equipment, land, or livestock you can pledge to secure the loan.
- Experience: Management skills and track record in farming or ag operations.
- Equity or down payment: Some loans require 5–20% equity, depending on the program.
PSB tip: Don’t be discouraged if your credit isn’t perfect. A local lender like PSB looks at the whole picture, not just a number.
Apply for an Ag Loan Through PSB
How to Prepare Before You Apply
Preparation can make or break your application. Here’s what to have ready:
- Recent financial statements (3–5 years, if available)
- Profit & loss and cash flow projections
- Tax returns and records of major purchases or debts
- List of assets and liabilities (equipment, land, leases, etc.)
- Farm management plan including crop rotation, herd size, or production estimates
- Crop insurance or risk management documentation
Having these ready not only speeds up your application; it shows lenders you’re serious about running your farm like a business.
Managing Risk in Missouri Agriculture
Missouri farmers face unique challenges. While the land is fertile, the risks are real. Understanding them, and planning ahead, is key to long-term stability.
Top risk factors:
- Rising input costs: Fertilizer, fuel, and feed prices remain volatile.
- Interest rate fluctuations: Rates can impact borrowing costs and cash flow.
- Weather extremes: Drought, flooding, or tornadoes can affect yields and income.
- Market volatility: Global trade shifts can affect commodity prices overnight.
Mitigation strategies:
- Build an emergency fund for unexpected expenses.
- Diversify crops or livestock when possible.
- Use risk management tools such as crop insurance and forward contracts.
Partner with a local lender who understands your area and can help you adjust when markets change.
Why Missouri Farmers Choose PSB
Here’s why farmers across Missouri choose Peoples Savings Bank:
- Local decision-making: All loan decisions are made right here in Missouri.
- Experienced ag lenders: Our team understands the realities of farming.
- Flexible repayment terms: We tailor your loan around your harvest cycle.
- Relationships that last: We’re not just your lender; we’re your neighbors.
Partner with PSB for Ag Services Today
Steps to Apply
When you’re ready to take the next step, here’s what to expect:
- Meet with your local PSB ag lender — discuss your goals and what kind of financing fits best.
- Submit your application — include financial records, farm plan, and collateral details.
- Appraisal & review — PSB will evaluate collateral and verify your information.
- Loan approval & terms discussion — you’ll review repayment options and rates.
- Closing & disbursement — funds are released, and your operation moves forward.
Grow Smart with Local Support
Agriculture is the backbone of Missouri, and the heart of Peoples Savings Bank. Whether you’re buying your first combine, expanding acreage, or investing in the next generation, we’re here to help you every step of the way.
Ready to start your ag loan journey? Visit your nearest PSB branch or apply online at ourpsb.com. Let’s grow your farm together, with experience, trust, and local expertise you can count on.