TexasWaterFrontRanches

Farm Credit specializes in financing rural real estate in the south, and they offer plenty of free advice with their Fenceposts Blog and Landscapes Magazine articles. 

Also on their site, they offer Tips for Buying Rural Real Estate. These tips can be helpful for both someone new to ranch real estate or anyone who wants to make sure nothing is overlooked.

1. Local Advice

Get the advice of a local Realtor or loan officer who is both experienced in rural real estate, and knows the area well. They will know the local market, may know the histories of the properties in the area, and they can put you in touch with contractors and service providers.

2. Infrastructure

Be sure to ask about water and sewer services, trash pickup and road maintenance, school bus service, electric, phone, cable and high speed internet.

3.   Tax Advantages

A rural property may qualify for a tax credit, special appraisal or direct exemption. There may be existing ag exemptions.

4. Environmental Factors

By law, the presence of endangered species may limit ability to do some things like clearing brush or constructing buildings. Federal law also holds landowners accountable for contamination cleanup even if it occured before they owned the property – buyers can predetermine some environmental hazards and obtain  some liability protection.

Sandy Ranch

5. Codes and Restrictions

Government restrictions, county subdivision laws or extended territorial jurisdictions may affect subdivision of land.

6. Insurance

Some providers might not offer insurance for outside of city limits.  Your Realtor or loan officer can help.

7.  Local Land Use

Pay attention to what others in the area are using land for (for example, if you are ok living next to a large livestock operation) and any proposed developments.

8. Property Improvements

Improvements (such as fences or walls) can be expensive, especially on large properties. Certain improvements (such as septic systems or wells) may require certain county permits. Look into any permits and construction costs first, as well as needed well depths and septic system requirements for the soil conditions.

9. Maintenance Costs

Landscaping, repairs, equipment, and any building will all require additional costs.

10. Financing Country Homes

Some mortgage companies may only finance a certain number of acres, your Realtor can help you find a lender and the loan you’re looking for.

Lonesome Bayou Ranch

The Federal Agricultural Mortgage Corporation, or Farmer Mac, is a government sponsored enterprise providing a secondary market for agricultural real estate and rural housing mortgage loans. They were created by congress in 1987 (in response to the farm crisis of the 80’s) to improve the ability of agricultural lenders to provide credit to America’s farmers, ranchers, rural homeowners, agricultural businesses and communities.

They do this by primarily purchasing loans from lenders, replenishing their funds to make new loans. Farmer Mac then funds its loan purchases by issuing debts or securities backed by pools of loans and selling them into the capital markets. “In doing so, Farmer Mac facilitates the flow of money from Wall Street to rural America, providing a stable supply of mortgage credit to lenders and borrowers” (Farmer Mac).

Farmer Mac has two primary programs:

- Farmer Mac I purchases qualified loans from lenders who are approved sellers.

Organic Free Range Egg Operation

- Farmer Mac II purchases portions of qualified loans guaranteed by the U.S. Department of Agriculture, providing secondary market funding to support the USDA loans.

A Farmer Mac III option combines Farmer Mac I and II.

Farmer Mac has proved to be a successful and stable program, earlier this summer posting a first quarter profit and 124% share increase.

If you are interested in learning more about farm credit services, you can visit www.farmcredit.com and click on your state. Or you can talk to your Realtor about finding a Farmer Mac approved lender.