OFFICE OF STATE LANDS AND INVESTMENTS
STATE LOAN AND INVESTMENT BOARD
122 WEST 25TH STREET
CHEYENNE, WYOMING 82002
REGULAR FARM LOAN / BEGINNING AGRICULTURAL PRODUCERS /
SMALL WATER DEVELOPMENT PROJECT APPLICATION PACKET
The original Farm Loan Act was passed by the Wyoming Legislature in its session of 1921, becoming effective on February 22nd of that year. The purpose of the law is to foster and encourage farming and ranching in the State of Wyoming, to develop and improve agricultural lands and to create and establish a system of rural credits to be controlled and managed by the State Loan and Investment Board. The Board consists of the Governor, Secretary of State, State Treasurer, State Auditor, and State Superintendent of Public Instruction. The Director of the Office of State Lands and Investments serves as secretary to the Board.
The State Treasurer, with the approval of the State Loan and Investment Board, is directed by the Legislature to invest and keep invested in farm and ranch loans, a sum not exceeding $275 million in permanent funds.
This program is governed pursuant to Wyoming Statutes 11-34-101 through 11-34-130, and the rules and regulations adopted by the State Loan and Investment Board.
General Policy - The Board shall extend farm loans to foster and encourage agriculture, dairying, and livestock raising in the State of Wyoming, and the development and improvement of farm lands. Farm Loans shall be made in a manner to parties which, in the judgment of the Board, will derive the greatest benefit to the state and represent a wise investment of state funds.
Eligible Applicants - Individuals must be U.S. citizens, 18 years of age or older, and their primary residence must be in Wyoming. Legal entities must demonstrate that a majority is owned by individuals who meet the qualifications. Single loans or combination of loans made to an individual, or entity, shall not exceed an outstanding principal balance of $600,000.00. A single agricultural enterprise shall not exceed the $600,000.00 maximum loan balance regardless of the identity of the applicants.
Eligible Purposes - Loans may be made for agricultural purposes including purchasing land, livestock, or equipment designated to maintain or increase the earning capacity of the operation; purchasing, constructing, or installing improvements necessary to maintain or improve the earning capacity of the operation; and refinance debts incurred by the applicant in the furtherance of the agricultural operation. The borrower must have a mature obligation at closing so interim financing may be necessary.
Application Procedure - Prospective borrowers must submit a written loan application, on the form furnished by the Office. Incomplete applications will not be submitted to the Board for consideration. False or misleading statements made by the applicant in an application can be grounds for rejection of the application. A $100.00 deposit must accompany the application and will be returned if the application is withdrawn prior to a field appraisal being made.
Application Consideration - The Board=s staff will conduct a preliminary review of all applications received. If the staff identifies problems with the application, the applicant will be notified of the problem and given an opportunity to withdraw the application. The Board takes the following into account when considering applications: the applicant=s net worth (a minimum of 40% owner=s equity), the applicant=s ability to repay the loan based on viable, continuous income from any source, and the applicant=s credit history.
Loan Terms - The interest rate charged shall reflect the risk taken by the Board. Rates shall be: 8% per annum for loans up to 50% of the appraised value of the security land and improvements, 9% per annum for loans over 50% up to 60% of the appraised value of security land and improvements. The term of the loan shall not exceed 30 years. Payment of the loan will be made in equal annual installments, due December 1 of each year. The following chart will help determine an approximate annual payment.
Interest Rate Number of Years
5 10 15 20 25 30
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8% $250.46 $149.03 $116.83 $101.85 $ 93.68 $ 88.83
9% $257.10 $155.83 $124.06 $109.55 $101.81 $ 97.34
To figure your annual payment, multiply the factor in the chart by the number of $1,000.00 loan desired.
Example: $150,000.00 Loan, 8% Interest, 30 years
$88.83 x 150 = $13,324.50 Annual payment including interest
Security - All loans will be secured by a first mortgage on farm or ranch land of sufficient value to secure the loan. Only land lying within the boundaries of the State of Wyoming can be considered as security. Proof of merchantable title must be provided by the borrower in the form of title insurance naming the Board as the insured. The security will be appraised by a qualified Board appraiser. The appraisals will reflect the current agricultural market value of the land to be mortgaged and contributory value of the improvements. The Board will take a UCC security agreement on all irrigation equipment located and used on the security lands. Whenever necessary to protect the value of the security lands as an agricultural operation, a security interest in secure leaseholds, reservoir or ditch company stock, water contracts, and grazing association stock will be taken.
Disbursement - The proceeds of a farm loan shall not be disbursed to the borrower until such time as the borrower can show a mature obligation, the satisfaction of which will result from the application of the loans proceeds. The borrower shall use the proceeds of a farm loan exclusively for the purpose or purposes set out in the application, and shall furnish evidence satisfactory to the Board to that effect. Loan proceeds shall be disbursed at a closing when all loan documents shall be executed by the borrower. Documents executed on behalf of corporations or other legal entities shall be executed by persons authorized by the corporation or entity to borrow money and mortgage property owned by the entity. Personal liability is required on all loans. Loans are closed through a title insurance company. A loan fee of 1% of the loan amount is withheld by the Board at the time the funds are disbursed.
BEGINNING AGRICULTURAL PRODUCER LOANS -
"Beginning Agricultural Producer" means an individual or entity that has never owned and operated more than160 acres of cultivated irrigated land, or 320 acres of cultivated dry crop land, or 640 acres of grazing land unless such land was acquired within the last two (2) years; has adequate working capital; substantially participates in the operation; and meets all eligibility requirements provided for in Chapter 7 - Farm Loans.
The Beginning Agricultural Producer loan program is intended to help beginning farmers or ranchers get into a production agriculture business. It is not intended to benefit investors or developers.
For Beginning Agricultural Producer loans, for the first ten (10) years of the loan the interest rate shall be the lower of 8% or the average yield on a ten (10) year U.S. Treasury Bond for the previous year, rounded to two (2) decimals, as of the date of loan closing. At the end of ten (10) years the interest rate shall be 8%. Loans to beginning agricultural producers shall not exceed 70% of value.
SMALL WATER DEVELOPMENT PROJECT LOANS -
The State Loan and Investment Board under Wyoming Statutes 11-34-302, is authorized to finance projects for development and use of water upon agricultural lands for agricultural purposes. Loan proceeds may not be used to refinance debt or operating loans. Individual loans may be made for sums not to exceed $150,000.00 at 6% interest. The Board shall require such security as is deemed advisable and may include first and/or second mortgages on agricultural real estate, the pledge and assignment of designated special property assessments within a district, and/or first lien on irrigation equipment and fixtures.
The Board may make loans to court approved water districts, to agencies of State and local government, persons, corporations, associations, and other legal entities in this State, to finance the construction of water development projects. Water development projects may include projects to convert dry land into irrigated land as well as projects which will lead to more efficient use of water and/or increased crop or forage production.
STATE LOAN & INVESTMENT BOARD LOAN NO. ______
APPLICATION FOR LOAN
FOR OFFICE USE ONLY
Applicant's Full Name S.S.N. or E.I.D.
Date Received:
Spouse/Co-Applicant S.S.N. or E.I.D.
Date Paid:
P.O. Box or Street Address
City State ZIP Code
Day Phone No. Evening Phone No. E-mail address
FILING FEE: $100.00
I hereby make application through the Office of State Lands & Investments, Cheyenne, Wyoming, for a: Farm Loan $ ; or Beginning Agricultural Producers Loan $ ; or Small Water Development Project Loan $ .
I understand that loans are approved based on a percentage of the appraised valuation of the land including contributory value of improvements and other factors. Interest rates will be set by the State Loan & Investment Board. Principal and interest will be paid on an amortized plan prescribed by the Board. As security for this loan, I offer a first mortgage on the following described real estate:
A. DESCRIPTION OF PROPERTY TO BE MORTGAGED:
Legal Description / Section / Township / Range / AcresATTACH ADDITIONAL PAGES IF NECESSARY TOTAL ACRES:
1. This land is miles and miles
(direction) (direction)
from and is located in the county/counties of
B. STATUS OF APPLICANT
1. If the applicant has an existing loan with the State Loan & Investment Board or has an interest in a legal entity which has an existing loan with the State Loan & Investment Board, please provide the following:
Loan No. Name Loan Balance Loan No. Name Loan Balance
(1) $ (3) $
(2) $ (4) $
2. If applicant is a partnership, give names and addresses of partners and percent of ownership:
3. If applicant is a corporation, give names and addresses of all officers/directors/shareholders and show percent of ownership.
President: ( %) Treasurer: ( %)
Vice President: ( %) Secretary: ( %)
(If additional room is needed, attach list of other stockholders and % ownership)
C. PURPOSE OF LOAN: To which of the following purposes do you agree to apply the proceeds of this loan?
PURPOSES / DESCRIBE FULLY / AMOUNT(1) To purchase ______acres of land. Total purchase price $ ______. Will this land be included in mortgage? ______(Provide copy of purchase agreement or contract) / $
(2) To construct or maintain buildings and other improvements. (Give description, size, material, cost, etc.)
(3) To purchase equipment, livestock, etc. (Describe and give amount for each purpose).
(4) To refinance debt incurred for any of the above purposes or for other agricultural purposes. (Describe)
(5) Loan Fee (1% of Loan Amount) & misc.
TOTAL (The total of the above must equal the amount of the loan applied for) / $
ALL QUESTIONS MUST BE ANSWERED
D. GENERAL INFORMATION. (If partnership or corporation, gives information for managing partner(s) or corporation president)
1. Are you a citizen of the United States? A Wyoming resident/qualified elector?
Single Married Separated Divorced
2. Are applicants of legal age? Applicant's number of dependents .
3. Give name, address, and agent=s telephone number for Insurance Company by which buildings and other improvements are insured and date policy expires:
4. I carry life insurance with Face Amount $
5. Have you ever filed bankruptcy? If so, Chapter Date Where filed?
Are you currently in bankruptcy?
6. Have you ever been involved in a debt settlement? If yes, describe
7. Name and address of bank(s) and/or other creditors with which you do business:
8. Occupation or business from which the majority of your income is derived:
. Former occupation, if any:
9. If employed, name and address of employer(s)?
10 Do you reside on the land offered as security? If not, state actual place of residence
Miles from security? How long have you resided there? How long have you farmed or ranched?
11. Do you operate this land personally? Do you use hired labor? Do you lease to tenants?
12. Have you listed for sale the lands offered as security?
13. Do you lease any State land? Give lease number(s)
Do you lease any U.S. Government land? Describe:
Do you lease any private land? Describe:
E. ESTIMATED PRODUCTION AND SALES (INCOME) AND EXPENSES:
PLANNED / ANNUAL OPERATING EXPENSESCROPS, PASTURE, ETC. / ACRES OR NUMBER / YIELD / UNIT PRICE IF SOLD OR "FEED" / TOTAL / Car/Truck Expense / $
1. / $ / $ / Custom Hire
2. / Feed
3. / Fertilizer & Chemical
4. / Freight & Trucking
5. / Gas, Fuel & Oil
6. / Insurance
7. / Labor Hired
8. / Rent or Lease
9. / Repairs & Maintenance
10. / Seed
LIVESTOCK / Supplies
1. / Property/Water Taxes
2. / Utilities
3. / Veterinary Expense
4. / Other Operating Expense
5. / Living Expenses
6. / Income Tax & Soc. Sec.
OTHER INCOME (Oil & Gas Lease/Royalty, Rent, Off-Farm Income, etc.) / Livestock/Mach. Purch.
1. / Int. on Operating Exp.
2. / Payments-SL&IB & Others
3. / 1.
4. / 2.
5. / 3.
TOTAL INCOME / $ / TOTAL EXPENSES / $
F. FINANCIAL STATEMENT FOR