IOWA FINANCE AUTHORITY
1963 Bell Avenue, Suite 200 | Des Moines, Iowa 50315
515.452.0400 | 800.432.7230 | fax 877.461.0904
IADD@IowaFinance.com | IowaFinance.com
Beginning Farmer Loan Application Instructions
Attached is the application for the Beginning Farmer Loan Program (BFLP). The Iowa Agricultural Development
Division (IADD) Board normally reviews loan applications on the fourth Wednesday of the month and then makes
a recommendation to the Iowa Finance Authority (IFA) Board on the first Wednesday of the following month.
Applications need to be in the Authority’s office by the 1st day of the month in order to be considered at
that month’s meeting.
Following is a list of items to be submitted when completing an application for a loan:
1. Compl
eted BFLP application, the application must be legible. If it is illegible, it may be returned or delayed.
2. $100 application fee. Make check payable to the Iowa Agricultural Development Division (IADD).
3. Background fo
rm or submit a background letter containing the following information about the Beginning
Farmer:
Experience and/or education in farming.
Ag lender and access to working capital.
Access to adequate machinery.
Where down payment funds are coming from.
Any additional information.
4. A fi
nancial statement less than 30 days old.
Signed by the beginning farmer, spouse (if applicable) and preparing lender.
See “Current Financial Statement” placeholder for financial statement criteria.
5. An appr
aisal (if applicable) will be required (2 weeks prior to closing) if:
The project purchase includes a dwelling or out-buildings on the property. (No more than 5% of the bond
proceeds can go towards the purchase of a dwelling)
The project includes CRP land. (No more than 25% of the bond proceeds can go towards the purchase
of CRP land, if there is also a dwelling on the property than only 20% of the bond proceeds can go
towards the purchase of the CRP land)
The project is being purchased from a closely related party (parent, grandparent or sibling). The
purchase price cannot be less than fair market value which is determined by the appraised value.
6. Feeding Cont
ract (if applicable) will be required (2 weeks prior to closing). If purchasing or constructing a
facility, the maximum bond amount allowable is the farm improvement maximum of $250,000. Also per
federal regulations the feeding contract will have to be on a per head / per day basis to qualify.
7. Cont
ract Sale (if applicable). If the project is a contract sale. Contract Sellers should have the contract
prepared between the Seller and the Iowa Finance Authority (IFA). Sample contracts will be furnished by the
Authority with the application receipt letter. A contract should not be filed/recorded until attorneys for the
Authority have reviewed its contents and the Executive Director has signed for the Authority.
If you have any questions, please contact the IADD office or visit our website at IowaFinance.com
NOT
E: The closing fee is not to be paid until the time of loan closing
.
BFLP Application
Rev. 02.21.2020
IOWA FINANCE AUTHORITY
1963 Bell Avenue, Suite 200 | Des Moines, Iowa 50315
515.452.0400 | 800.432.7230 | fax 877.461.0904
IADD@IowaFinance.com | IowaFinance.com
(Date Received by IADD)
PLEASE NOTE: This application is a publicly available document.
BEGINNING FARMER LOAN PROGRAM (BFLP) APPLICATION
(To be completed by the applicant and lender -- please print or type all information)
Note: Approval of this application does not constitute final loan approval. If prior to closing, it is discovered that the Project, in whole or in part, is ineligible for
tax-exempt financing, or if the Project should become ineligible, the Authority may refuse to complete loan processing or reduce the loan amount.
1. Type of application PLEASE CHECK ONE: Bank Loan or Contract Sale or Individual Investor
2. Name of applicant Spouse
Address: Telephone
City State Zip E-mail:
Age (for statistical purposes)
3. Bond Purchaser (bank, contract seller or individual investor)
Contact Person: Telephone
Address Fax
City State Zip E-mail:
4. Purpose of Project - *AN APPRAISAL WILL BE REQUIRED IF PROPERTY HAS A DWELLING OR OUT-BUILDING(S)
**A DWELLING & CRP ACRES MAY LIMIT ELIGIBILITY SE
E PROGRAM SUMMARY
Purchase land: Total Acres _ Tillable Acres _
Estimated value of house** $_ * Pasture Acres _
Estimated value of out-buildings $_ * CRP Acres** _
Purchase machinery_
Purchase livestock (what and how many) _
Make building or other farm improvements of _
Who will own the property where improvements are to be made _
If constructing hog/livestock buildings, who will own animals in building? _
(If applicant will not own hogs/livestock, a feeding contract will be required)
PER FEDERAL REGULATIONS THE FEEDING CONTRACT WILL HAVE TO BE ON A PER HEAD / PER DAY BASIS
5. Financing of Project (Contributions by applicant, lender or contract seller and IFA)
Land
Purchase
Livestock
Purchase
Machinery
Purchase
New Farm
Improvements
Total
Project
Down payment by applicant (If gift, need gift letter)
$
$
$
$
$
BFLP Bond - Financed by Lender
$
$
$
$
$
Other Financed by Lender
$
$
$
$
$
(FSA) Farm Service Agency
$
$
$
$
$
From other sources:
$
$
$
$
$
IADD Loan Participation
$
$
$
$
$
TOTAL COST OF PROJECT:
$
$
$
$
$
Loan closing fee of 1.50% of the BFLP bond (loan) at time of closing
1
BFLP Application
Rev. 02.21.2020
IADD App Approved Project Number
IFA Bond Approved LPP Project Number
Amount Approved $100 Fee Received
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
6. Location of Project
a. List the county and township names with section numbers (e.g. Section 26, Bristol Township, Any County, IA)
b. Location by road from nearest town: (Example - 4 miles north of Anytown, IA on State Highway 175). Roads must
be identified, unless they are unmarked gravel roads, then state as such.
c. Will the project consist of the construction or acquisition of buildings, structures or other immovable property,
including remodeling of or additions to existing structures? YES NO
d. Will the Beginning Farmer be the sole owner of the land where the project will be located? YES NO
If NO, will applicant have a long-term lease for the length of the loan? NA YES NO
7. Seller of Property
Address
City State Zip Telephone
a. Please indicate if you are acquiring the “Project” directly or indirectly from a related person: YES NO
If YES, please explain the relationship.
NOTE: Contract sales are not allowed between the beginning farmer and their grandparents, parents, children or siblings. Cash/bank loans are
permitted with these relatives, but the Authority’s Fair Market Value Certificate and Related Person Certificate must be completed.
b. Please explain if you have begun to acquire or construct any part of the “Project” for which you are requesting a loan;
have entered into any contract or purchase agreement (installment or otherwise) in connection with the construction
or acquisition of the “Project,” or have begun off-site fabrication or acquisition of any portion of the “Project.”
NOTE: Down payments made more than 60 days prior to approval of the application will not be eligible for bond financing.
8. Previous tax-exempt financed projects
Have you, your spouse, minor children or any related person received tax-exempt financing of any kind in any stat
e?
YES NO If YES, please explain.
9. What is the net worth of the beginning farmer (including spouse and minor children)? $
NOTE: A financial statement is also required of any partnership, corporation, or other entity, etc. in which the beginning farmer has a financial interest.
a. Is a current personal financial statement less than 30 days old, signed by the beginning farmer, spouse (if applicable)
and preparing lender?
YES NO
b. Are all assets valued at fair market value by the lender? YES NO
If NO, please explain.
(Please attach a copy of the financial statement and detailed list of machinery owned.)
PROPOSED LOAN TERMS FOR IADD BOND
(Complete question 10 with your lender, contract seller, or individual investor, whichever is applicable.)
10. Wh
at are the proposed loan or contract sale terms?
a. Tax-exempt interest rate: percent (%) FIXED OR VARIABLE (Variable, must complete below)
Rate index: (ExampleFixed for ten years then 80% of bank's prime rate, such prime rate currently is 11%)
Adjustment frequency: Every years thereafter
b. Total term: years.
c. Repayments: monthly, quarterly, semi-annually, annually OR other (specify below)
Amount $ Does this amount include interest? YES NO
d. Proposed Date of Closing:
e. First payment due date:
f. Call options as follows:
OR balloon amount of balloon $
NOTE: Balloon will automatically end tax exemption -- See Program Summary.
2
11. Previous and Present Land Owned (If your answer to 11a is no, skip to question 12.)
a. Have you, your spouse, or minor children ever directly or indirectly owned any farmland? YES NO
Note: The following are examples of indirect land ownership:
1) ownership of a beneficial interest in a trust which in turn holds land.
2) ownership of shares in a family farm corporation which owns land.
3) a remainder interest in land which is subject to a life estate in another person.
b. Describe each parcel of land presently or previously owned by county location, size, and the time period during which
you owned it. (If the ownership is indirect, also describe the means of ownership and the total amount owned, for
example, "I have a one-fourth beneficial interest in a trust; the trust holds a total of 200 acres"):
c. Have you, your spouse, or minor children done any of the following:
1) performed physical work on the land? 1) YES NO
2) participated in management decisions about operations on the land? 2)
YES NO
3) provided regular advice and consultation on the business operations on the land? 3)
YES NO
4) regularly inspected production activities on the land? 4) YES NO
5) directly or indirectly advanced funds or paid a substantial portion of the operating
expenses for operations on the land? 5)
YES NO
6) lived on the land? 6) YES NO
d. Please describe the degree of your involvement in each activity, the frequency of your involvement and the length of
time over which your involvement occurred. (Use additional sheets if necessary):
e. Have you disposed of any of these parcels of land? e) YES NO
If YES, please identify the parcel(s) and the approximate date disposed:
f. Did you, your spouse or minor children recognize income, for federal income purposes, as the result of cancellation of
indebtedness with respect to any of the parcels disposed? f)
YES NO
If YES, identify the parcel(s) with respect to which income was recognized:
12. Management and Labor of Project will be provided by:
a. Will any of the labor be performed by or management provided by individuals or entities other than the Applicants?
YES NO If YES, please describe:
b. Will any portion of the Project be used in connection with any new or existing farm partnership, farm corporation,
limited liability company, or other formal or informal joint farming venture, including contract feeding arrangements?
YES NO If YES, please describe:
c. Will any of the applicants work off the farm?
YES NO If YES, amount of non-farm income anticipated: $
Where will he/she be employed?
Explain any other related details to non-farm income
d. Please explain what your farming operation will consist of and include the new project:
Crop acres on owned land:
Crop acres on cash rented land:
Crop acres on crop-share rented land:
Owned livestock operation:
Contract-feeding livestock operation:
Other farm operations:
3
CERTIFICATIONS OF APPLICANT
To be completed by beginning farmer applicant/s
In submitting this application, I, the undersigned Beginning Farmer, have read the following statements and hereby certify and agree that:
1. I will be a permanent resident of the state of Iowa at the time of bond issuance. True False
2. I have sufficient education, training or experience in the type of farming for which this loan is requested. True False
Attach the background form or background letter.
3. The Project shall be used only for farming by myself, my spouse, and/or minor children, and we will perform the labor and provide the
management needed to use the Project for farming. True False
4. None of the proceeds of the loan shall be used for the refinancing or restructuring of any existing indebtedness in whole or in part, working
capital, operating purposes or for inventory or supplies for the Beginning Farmer or any related person. True False
5. I have or will have access to adequate working capital, farm equipment, machinery or livestock (if the loan proceeds are to be used to acquire
agricultural land), and I have or will have access to adequate working capital or agricultural land (if the loan is to be used to acquire depreciable
agricultural property). True False
6. I agree the loan may not be assumed by another person without the Authority’s prior approval and then only if the purchaser of the property is
an eligible applicant for an BFLP loan. I presently plan to retain the property financed by the loan for the term of the loan; however, I
understand equipment and other depreciable property may be exchanged or traded in on similar property, and other property such as breeding
livestock may be added or substituted as collateral at the discretion of the Lender without prior approval of the Authority. I also understand that
the benefits of the loan, made at the tax-exempt rate from the proceeds of an BFLP bond, must be retained by myself, and no person to whom
property is traded or otherwise transferred may obtain the benefits of the BFLP loan. True False
7. I understand and agree that I am responsible for submitting an application fee with this application and a loan closing fee of 1.50% of the bond
amount to the IADD at the time of loan closing; such fees will be used for expenses of administering the Individual Agricultural Development
Bond Program. True False
All of the information I have provided in the application is true and complete. Also, I understand this application and any of the documents prepared
or submitted in connection with it or the loan referred to hereon are “public records” as defined in Section 22.1 of the Iowa Code and are subject to
examination, copying, publication or other dissemination by any person.
_________________________ ________________________________________________________________________________
Date Signature of Beginning Farmer
________________________________________________________________________________
Signature of Beginning Farmer’s Spouse
CERTIFICATIONS OF BOND PURCHASER
To be completed by Lender, Contract Seller, or Individual Investor
The undersigned Bond Purchaser has read the following statements and hereby certifies that:
1. All of the proceeds of the bond will be used for the acquisition, construction, reconstruction, equipping and installation of land, or property of a
character subject to the allowance for depreciation under Section 167 of the Internal Revenue Code.
2. To the best of the bond purchaser’s knowledge, each of the Certifications of the Applicant and all other information with respect to the project
or applicant set forth in this application is true and correct.
3. The proceeds of the bond will not be used to provide working capital or finance inventory, supplies or other operating expenses for the
applicant or any related person, or be used to refinance or restructure any portion of existing indebtedness.
4. The Bond Purchaser requests the Authority to issue and sell its bond to the Bond Purchaser for the purpose of financing the project to the
extent thereof.
5. The principal and interest on the bond do not constitute an indebtedness of the Authority or the State of Iowa or a charge against their general
credit or general funds.
Bond Purchaser or Bank Name
______________________ By _______________________________________________________________________________________
Date Signature of Official of Bank, Contract Seller, or Individual Investor
This application cannot be reviewed unless the Authority has received all of the following:
$100 application fee Background form or letter
Current personal financial statement signed by the beginning Completed application form signed by both parties
farmer, spouse (if any) and preparing lender Certificatespages 5 & 6, if sale from close relative
Mail completed application, attachments and application fee to:
4
IOWA AG DEVELOPMENT DIVISION
IOWA FINANCE AUTHORITY
1963 Bell Avenue, Suite 200
Des Moines, Iowa 50315
Beginning Farmer Background Form
Complete this form or submit a background letter
Print Name of Beginning Farmer:
1. Describe your experience, training and/or education that will allow you to carry out this farming
operation:
2. Who is your ag lender and what arrangement do you have for working capital:
3. Explain your access to adequate machinery and equipment do you own all the equipment you will
need or do you have arrangements to lease or trade labor for equipment?
4. Explain where your down payment funds are coming from? (Only need to answer if you are making a down
payment and the funds are not reflected as cash or a payable on your balance sheet) If a gift, a gift letter will be required.
5. Please provide any additional background information you would like to include:
Date Signature of Beginning Farmer
5
TO BE COMPLETED ONLY IF SELLER IS GRANDPARENT, PARENT OR SIBLING
RELATED PERSON CERTIFICATE
The undersigned Seller(s) owns the following Agricultural Land, Agricultural Improvements, and/or Depreciable
Agricultural Property (the “Project”):
which is being sold to (the “Beginning Farmer”) and is
being financed with proceeds from an Agricultural Development Revenue Bond to be issued by the Iowa Finance
Authority.
The Seller hereby:
(1) Provides a copy of the appraisal that confirms the fair market value of the Project is: $
(2) Certifies that the Project is being sold to the Beginning Farmer for its fair market value.
(3) Certifies that subsequent to such sale:
a. If the Project is being operated by a formal or informal partnership or joint venture, the Seller will have no
more than a 10 percent interest in such operation;
b. If the Project is being operated by a corporation, the Seller has no more than a 10 percent stock or ownership
interest in such corporation;
c. If the Project is being operated by a trust, the Seller has no more than a 10 percent beneficial interest of
such trust;
d. The Seller will not be a user of more than 10 percent of the Project; and
e. The Seller will not have any other direct or indirect ownership or use of the Project.
IN WITNESS WHEREOF, we have hereunto set our official signatures as of the
day of , 20 .
SELLER
By ____________________________________
(Signature of Seller)
(Print or Type Seller’s Name)
By ____________________________________
(Signature of Co-Seller)
(Print or Type Co-Seller’s Name)
6
TO BE COMPLETED ONLY IF SELLER IS GRANDPARENT, PARENT OR SIBLING
FAIR MARKET VALUE CERTIFICATE
The undersigned on behalf of (the “Lender”) in
connection with the sale from (the “Seller”) of
Agricultural Land, Agricultural Improvements and/or Depreciable Agriculture Property as identified:
to (the “Beginning
Farmer”), to be financed with the proceeds of an Agricultural Development Revenue Bond to be issued by the
Iowa Finance Authority, hereby certifies the following:
(1) The attached appraisal establishes the fair market value of the Project to be: $
(Please send appraisal along with Fair Market Value Certificate)
(2) Purchase price being paid by the Beginning Farmer to the Seller for the Project is: $
(3) Total difference, if any: $
If difference of (1) minus (2) is greater than “O”, then application cannot be considered until purchase
price is adjusted to at least equal the Fair Market Value (1).
IN WITNESS WHEREOF, we have hereunto set our official signatures as of the
day of , 20 .
LENDER
(Lender/Bank Name)
(Signature of Loan Officer)
(Print or Type Name of Loan Officer)
(Title)
7
REPLACE THIS PAGE WITH:
BEGINNING FARMER
CURRENT FINANCIAL STATEMENT
READ CAREFULLY
MUST be less than 30 days old
MUST be prepared and signed by lender or financial professional, as “preparer”
MUST be signed by beginning farmer and spouse*
*All assets of the beginning farmer’s spouse and minor children MUST be included
on the financial statement
All assets MUST be valued at fair market value*
*Fair market value is what a willing buyer would pay a willing seller in the locality
Financial statement MUST include all schedule pages
Financial statement MUST include a machinery list* (if applicable)
*Machinery list should include year, make, model and value of all machinery
DO YOU HAVE AN OWNERSHIP INTEREST IN AN ENTITY?
No, you are done.
Yes, see below.
Note: A financial statement is also required of any partnership, corporation, LLC or other entity
in which the beginning farmer, spouse and/or minor children has a financial interest
and MUST also abide by the above criteria.
ALL OF THE ABOVE FINANCIAL STATEMENT CRITERIA MUST BE FOLLOWED
OR THE APPLICATION WILL BE RETURNED
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