How To Find The Right Lender & Communicate Effectively

Communication is key in any relationship. But it’s one of the most important pieces you can bring to the table as a new borrower when you’re beginning to build a strong relationship with your lender.

“When you’re a new borrower, it can be really intimidating to communicate with your financial lender or even approach one in the first place,” explains Brenna Finnegan, account officer and host of AgCredit Said It. “But it’s just as important to talk with [your lender] just as much as it is to talk with your agronomist or your seed dealer or your equipment rep.”

In Episode 3 of AgCredit Said It, our team of hosts shares their advice on how beginning farmers can find and choose the right lender for their needs, how they can be best prepared for starting their lending relationship off on the right foot, and tips for communicating with their lender.

Finding a lender

For a new borrower, finding a lender can be difficult. There are so many different choices and various types of lenders, but Phil explains that one of his biggest tips for finding the right lender is to “start with a familiar face”.

Ask your fellow farmers and neighbors with whom they’ve had great experiences. Referrals can be a great way to start your lender search.

When choosing a lender, Libby says finding the right fit is pivotal. Traditionally, most farm operations are multi-generational, leading to multi-generational lending. But for a new borrower, be sure that the lender your grandpa or dad may have had, for example, is still well-suited to your operations.

Prepping for success

If you want to get started off on the right foot with your lender, come prepared with some important information:

• A balance sheet
• Last three years tax returns
• A business plan
• Questions

These documents can be intimidating and you may not know what to include, but just know that your lender is going to be your resource throughout the entire process.

Communicating with your lender

Whether you’re a new borrower or a seasoned member, communication with your lender leads to the long-term, continued success of your operation.

However, farming is an unpredictable business.

“It always seems like we have great communication in good times in agriculture,” says Matt. “But we want to continue that great communication in the distress times of agriculture.”

Being able to have an open and honest conversation with your lender, in good times and in bad, about your operation’s finances will make your lending relationship stronger.  

The lending process doesn’t have to be intimidating. Lean on your lender as a trusted resource and business partner. If you want to learn more about how to build a strong lender relationship, be sure to listen to Episode 3 of AgCredit Said It.