An agricultural mortgage is a long-term loan secured against farmland, farm buildings or a farmhouse. It is usually used to buy land, buy out a family member, restructure existing borrowing or fund a major capital project. Because it is secured on property, the land, buildings or home you put up as security can be taken from you if you do not keep up the repayments.
That warning is the most important sentence on this page, not a footnote. The term is typically measured in years or decades, so you are committing the holding to a debt that will outlast several trading cycles, changes in prices and yields, and quite possibly a change of generation. Think about how the payments would be met in a bad year, not just an average one, and take independent legal advice before you sign.
It differs from machinery finance in scale and in timescale. The amount is set against the value of the land rather than a machine, the lender will want a formal valuation and legal work before completion, and the process is slower — expect weeks rather than days.
Lenders will generally look at the security itself, your farming accounts, the total borrowing already secured on the holding, and how the loan will be serviced across good years and bad. Repayment can often be structured to reflect farm income patterns, and some lenders offer interest-only periods, but what is available varies by lender and by the strength of the application.
CW Asset Finance is a credit broker, not a lender, and arranges agricultural mortgages through its panel. We cannot guarantee that any lender will agree to lend, and the terms are the lender’s to set.