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Farm Equipment Financing: Best Farm Loan Options

By Randa Kriss
Last updated on May 16, 2024
Edited bySally Lauckner
Fact checked and reviewed
You can get farm equipment loans from the Farm Service Agency, SBA lenders, online lenders and specialty financing companies.

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Farm equipment financing is available from a range of sources, including government agencies and lenders that specialize in agriculture. Farm equipment loans can be used to buy new and used machinery, vehicles and other equipment that’s necessary for your operations.
The best farm equipment financing is the most affordable small-business loan you can qualify for that meets your needs.

How much do you need?

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We’ll start with a brief questionnaire to better understand the unique needs of your business.

Once we uncover your personalized matches, our team will consult you on the process moving forward.

Here are 7 farm equipment financing options

LenderNerdWallet RatingMax loan amountMin. credit scoreNext steps

FSA Direct Operating Loan

Best for Low-interest farm equipment loans

$400,000Undisclosed

AgDirect Farm Equipment Financing

Best for Flexible farm equipment financing

UndisclosedUndisclosed

Triton Capital - Equipment financing

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4.0/5

Best for Farm equipment financing for bad credit

$250,000575

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JR Capital Equipment Financing

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4.0/5

Best for Fast farm equipment loans

$10,000,000620

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National Funding - Equipment Financing

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4.5/5

Best for Farm equipment financing for startups

$150,000600

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SBA 7(a) loan

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Best for Large farm equipment loans

$5,000,000650

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U.S. Bank Equipment Financing

Best for Established farms

$1,000,000Undisclosed

Here are 7 farm equipment financing options

Best for Low-interest farm equipment loans

Farm Service Agency

Max Amount

$400,000

Min. Credit Score

Undisclosed

Best for Flexible farm equipment financing

AgDirect

Max Amount

Undisclosed

Min. Credit Score

Undisclosed

Best for Farm equipment financing for bad credit

Triton Capital

Max Amount

$250,000

Min. Credit Score

575

Best for Fast farm equipment loans

JR Capital

Max Amount

$10,000,000

Min. Credit Score

620

Best for Farm equipment financing for startups

National Funding

Max Amount

$150,000

Min. Credit Score

600

Best for Large farm equipment loans

U.S. Small Business Administration

Max Amount

$5,000,000

Min. Credit Score

650

Best for Established farms

U.S. Bank

Max Amount

$1,000,000

Min. Credit Score

Undisclosed

I'M INTERESTED IN:

Our pick for

Low-interest farm equipment loans

These Farm Service Agency loans offer low interest rates and repayment terms up to seven years.

FSA Direct Operating Loan

Max Loan Amount
$400,000
Min. credit score
Undisclosed
Est. APR
5.25-5.25%
The Farm Service Agency issues direct operating loans to established farmers who need to fund everyday expenses, equipment or machinery purchases and minor building improvements.

Max loan

$400,000

Min. Credit score

Undisclosed

Apr range

5.25-5.25%

The Farm Service Agency issues direct operating loans to established farmers who need to fund everyday expenses, equipment or machinery purchases and minor building improvements.

Our pick for

Flexible farm equipment financing

AgDirect specializes in equipment financing for farms and other agricultural businesses. You can buy or lease farm equipment from a dealership, as well as buy or refinance equipment from an auction or private party.

AgDirect Farm Equipment Financing

Max Loan Amount
Undisclosed
Min. credit score
Undisclosed
Est. APR
6.95-8.75%
Offered by Farm Credit Services of America and participating Farm Credit System Institutions, AgDirect provides flexible and low-interest equipment financing for farmers and agricultural businesses.

Max loan

Undisclosed

Min. Credit score

Undisclosed

Apr range

6.95-8.75%

Offered by Farm Credit Services of America and participating Farm Credit System Institutions, AgDirect provides flexible and low-interest equipment financing for farmers and agricultural businesses.

Our pick for

Farm equipment financing for bad credit

You may be able to qualify for a farm equipment loan from Triton Capital with a minimum credit score of 575.

Triton Capital - Equipment financing

4.0
NerdWallet rating 

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Max Loan Amount
$250,000
Min. credit score
575
Est. APR
5.99-34.99%
Triton Capital offers fast equipment loans up to $250,000 for businesses in a range of industries.
4.0
NerdWallet rating 

Max loan

$250,000

Min. Credit score

575

Apr range

5.99-34.99%

Triton Capital offers fast equipment loans up to $250,000 for businesses in a range of industries.

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Our pick for

Fast farm equipment loans

JR Capital can finance a range of new and used farm equipment — with approvals in as little as two hours and funding as fast as two days.

JR Capital Equipment Financing

4.0
NerdWallet rating 

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Max Loan Amount
$10,000,000
Min. credit score
620
Est. APR
6.99-18.00%
JR Capital provides fast equipment loans and leases, specializing in trucks, trailers and heavy equipment.
4.0
NerdWallet rating 

Max loan

$10,000,000

Min. Credit score

620

Apr range

6.99-18.00%

JR Capital provides fast equipment loans and leases, specializing in trucks, trailers and heavy equipment.

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Our pick for

Farm equipment financing for startups

New farmers and agricultural businesses may qualify for equipment financing from National Funding with just six months in operation.

National Funding - Equipment Financing

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Max Loan Amount
$150,000
Min. credit score
600
Borrowers who can't qualify for more traditional loan options might consider National Funding for fast access to capital.

Max loan

$150,000

Min. Credit score

600

Borrowers who can't qualify for more traditional loan options might consider National Funding for fast access to capital.
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Our pick for

Large farm equipment loans

SBA 7(a) loans can provide up to $5 million in farm equipment financing. These loans have competitive interest rates and long repayment terms.

SBA 7(a) loan

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Max Loan Amount
$5,000,000
Min. credit score
650
Est. APR
11.50-15.00%
7(a) loans are issued by private lenders and backed by the SBA. They offer long repayment terms and low interest rates.
Lowest interest rate

Max loan

$5,000,000

Min. Credit score

650

Apr range

11.50-15.00%

7(a) loans are issued by private lenders and backed by the SBA. They offer long repayment terms and low interest rates.
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Our pick for

Established farms

U.S. Bank can offer up to 125% in farm equipment financing — including soft costs, such as freight, warranties and taxes. You’ll need at least two years in business to qualify.

U.S. Bank Equipment Financing

Max Loan Amount
$1,000,000
Min. credit score
Undisclosed
U.S. Bank can provide up to 125% in equipment financing (including soft costs), with no down payment required.

Max loan

$1,000,000

Min. Credit score

Undisclosed

U.S. Bank can provide up to 125% in equipment financing (including soft costs), with no down payment required.

How Much Do You Need?

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What is a farm equipment loan?

A farm equipment loan is a loan that’s specifically used to purchase equipment for a farm or similar agricultural business. Depending on your lender, you may be able to buy new or used equipment, such as tractors, combines, harvesters, planters, dump trucks and utility vehicles, among other options.
Like other types of equipment financing, farm equipment loans typically use the machinery you purchase as collateral on the loan.

How does farm equipment financing work?

Farm equipment loans are usually structured as business term loans. You borrow a lump sum of capital from a lender and repay it, with interest, over a specific period of time.
Repayment terms on farm equipment loans can range from one to 10 years, depending on the type of equipment you’re purchasing. Terms are typically based on the projected useful life of the equipment. Payments are often made on a monthly basis, although some lenders offer flexible payment schedules (e.g., annually, semi-annually or quarterly).
Farm equipment loan rates can range from 5% to 15% from government, bank and direct lenders. Online lenders may have higher interest rates. The rate you’ll ultimately receive, however, will depend on your business’s qualifications, your down payment and the value of the equipment you’re buying.

Where to get farm equipment financing

Farm Service Agency

Backed by the U.S. Department of Agriculture, the FSA offers several types of farm loans. These loans have low interest rates and long repayment terms.
In general, you’ll need to meet agricultural-specific requirements to access FSA equipment financing. You must be able to show your managerial experience, eligible loan purpose and ability to repay the funding.
You should also have an acceptable credit history, although the FSA does not use credit scores. The agency will not automatically reject applicants for no credit history or isolated incidents of slow payments.
To apply for one of these government equipment loans, you need to fill out a lengthy and detailed application. Once you send a finished application to the FSA, it can take up to 60 days to receive approval and funding.
The FSA recommends reaching out to your local office or USDA Service Center for assistance on completing and submitting a loan application. These organizations can also help connect you with a local lender if you’re interested in a guaranteed loan.

SBA lenders

Although the Small Business Administration recommends that farmers start their financing search with the FSA, you can use SBA 7(a) and 504 loans for farm equipment purchases. Both types of loans can offer low interest rates, long repayment terms and a government guarantee from the SBA.
SBA 7(a) loans are available in amounts up to $5 million with interest rates ranging from 11.5% to 15%. Repayment terms for equipment purchases are available for up to 10 years. The SBA will guarantee up to 85% of the funding amount for loans up to $150,000 and 75% for loans greater than $150,000.
Similarly, SBA 504 loans are available in amounts up to $5.5 million with repayment terms up to 10 years for equipment. Unlike 7(a) loans, these loans come from three places: a Certified Development Company (CDC), a bank or credit union, and the borrower. Although most SBA 504 loans require a 10% down payment, farms are considered a “special purpose property,” which means you’ll have to put down a minimum of 15% of the funding amount.
Interest rates on 504 loans are tied to the five- and 10-year U.S. Treasury notes, and the SBA offers a 100% guarantee on the CDC portion of the loan. These SBA loans also require that your business meet a job and retention requirement, so they may be more difficult to qualify for than the standard 7(a) loan.
You’ll need good credit, multiple years in business and strong financials to qualify for a 7(a) or 504 loan. These SBA loans can be a good option for established farmers, especially if you have a previous relationship with an SBA lender.

Online equipment lenders

If you need farm equipment financing fast — or you can’t qualify for a government loan — online lenders may be a good option. These lenders typically offer streamlined applications with minimal documentation and may be able to provide funding in a few business days.
Online lenders tend to have more flexible qualification requirements than traditional lenders, and some may be willing to work with startups or businesses with bad credit. In exchange for this speed and flexibility, however, you’ll usually pay higher interest rates on your funding.

Specialty farm equipment lenders

Some lenders specialize in the agriculture industry and offer direct funding to farmers. These companies tend to provide a wide range of loan options as well as their knowledge and expertise to the financing process.
Although qualification requirements and loan details can vary from lender to lender, these companies can help farmers who may not be sure what type of funding they need as well as any borrower who prefers a more personalized experience.
As an example, Farm Credit is a network of customer-owned financial institutions that provide loans and financial services to farmers and other agribusinesses. Through this program, lenders across the nation can offer access to business capital and help farmers find the right financing for their needs. To find a Farm Credit institution in your state, you can use the search function on the network's website.
One of the best-known Farm Credit programs is AgDirect, an equipment financing program offered by several Farm Credit institutions. AgDirect allows you to finance and lease new and used farm equipment. You also have the option to buy or lease equipment from a dealership as well as buy or refinance equipment from an auction or private party.

How to get a loan for farm equipment

The best farm equipment loan for your business will ultimately depend on your individual financing needs and how well you meet lenders’ eligibility requirements. Here are some tips to help you get the right loan for you:
  • Evaluate your financing needs. Consider what type of equipment you’re looking to purchase and how much it costs. Some lenders may specialize in heavy equipment financing, for example, while others may not fund used equipment purchases. Understanding your specific needs can help you effectively direct your funding search.
  • Check your qualifications. Most lenders will use your personal credit score, time in business and annual revenue to underwrite your loan application. Reviewing these metrics ahead of time will give you a sense of where your business stands before applying.
  • Consider your down payment. Some lenders will require you to provide a down payment for your farm equipment financing — potentially up to 30%. If you can’t afford a down payment, you’ll want to look for lenders that offer zero-down financing. Alternatively, providing a down payment (especially when it’s not required) may help newer businesses or borrowers with bad credit qualify.
  • Get an equipment quote. Most lenders will want you to provide an equipment quote as part of your loan application. You should compare prices for the equipment you want to purchase to determine where you can get the best deal.
  • Compare farm equipment financing options. If you can qualify, opting for an FSA, SBA or bank loan may offer you the most competitive interest rates and terms. Online lenders may be a suitable choice, however, if you need fast funding or can’t qualify for more traditional options. In any case, you should research and compare multiple lenders to find the right fit for your needs.
  • Organize and prepare for your application. Most lenders will require you to provide basic information about you and your business, business financial documents and tax returns, among other paperwork. It can be useful to pull this information ahead of time to expedite the application process. You should also read the application instructions carefully — answering questions as intended and providing accurate and up-to-date documentation will help you get approved faster.

Frequently asked questions

Last updated on May 16, 2024

Methodology

NerdWallet’s review process evaluates and rates small-business loan products from traditional banks and online lenders. We collect over 30 data points on each lender using company websites and public documents. We may also go through a lender’s initial application flow and reach out to company representatives. NerdWallet writers and editors conduct a full fact check and update annually, but also make updates throughout the year as necessary.
Our star ratings award points to lenders that offer small-business friendly features, including:
- Transparency of rates and terms. - Flexible payment options. - Fast funding times. - Accessible customer service. - Reporting of payments to business credit bureaus. - Responsible lending practices.
We weigh these factors based on our assessment of which are the most important to small-business owners and how meaningfully they impact borrowers’ experiences.
NerdWallet does not receive compensation for our star ratings. Read more about our ratings methodology for small-business loans and our editorial guidelines.

Wondering if you qualify?

It’s possible to get a business loan even if you have bad credit. Bad-credit business loans are available from alternative sources, like online or nonprofit lenders.

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