How to Show a Lender that You’re Fiscally Fit

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For many agribusinesses, it’s almost time to close the books on 2019 and start planning for next year.  We often advise clients on the importance of maintaining a healthy, open relationship with your lender, during the good years and not-so-good years.

A recent article in The Wall Street Journal highlighted the financial stress that many ag producers are under currently as they face pull back from banks and are forced to take on high-interest loans.

“Agribusinesses are up against a wall right now with their lenders.  Even the tiniest misstep or discrepancy during the year can provide banks and other lenders with reason to deny credit requests or offer credit at higher interest rates,” says Peter Martin, finance and growth consultant with K·Coe Isom.

Loan Preparation is Critical: What Information You Need to Supply

The best practices for ensuring a smooth and successful loan renewal process, as Peter explains in his monthly Farm Journal columns, include positioning your business, exploring alternative lending options, and building a healthy relationship with your lender.

Here are some guidelines for setting expectations, providing beneficial information, and tips on how to properly request a loan.  Peter also includes an ‘Ag Loan Package Outline’ example to explain what a lender expects from your business.

For more information or guidance on preparing your business for the loan-renewal process and improving your borrowing chances, contact a K·Coe Isom advisor. 

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