How does a person get started with owning a farm?

Question

I have been very interested in starting a ranch/farm but I don't have the means necessary to buy any land. Land is selling for between $800-$2500/acre (depending on the classification and type).

My credit is shot but I have experience in farming (did custom haying for 12 years as well as lived and worked on a farm for 8 years). Problem is my experience doesn't qualify me for any starting farmer programs (must have at least 2 years farming managment experience). Most of the farmers in my area are looking at there farms as their retirement home/fund.

So making it simply put, I have no credit and not enough experience. Still how can I make my dreams come true of starting my own farm and ranch?

Answer 1

In my opinion it is very difficult because there are very few if any lenders who will lend money to even established farmers.

Farming anymore is a very poor business because the capital requirements are so high and the returns are so low.  Most farming operations are subject to adverse weather conditions at least once in every five years, (hail, drought, floods, blizzards, etc. that increases the risk.  A banker giving you half of what you need is a sure way for him to own the farm eventually.

Answer 2

You start small and go from there.  My credit is horrid thanks to my ex husband, and his brother (who stole my SS# & some checks).  

My physco ex burned down the house we owned, instead of paying me the money owned in the divorce.

No money, no credit, no house (heck, I didn't even have clothes!).

Lived with my Mom.  I purchased 5 sheep, and 3 goats (already had my two horses).  Stopped with the sheep, as they were too stupid, and kept drowning themselves.

I now have 45 acres, about 100 meat goats (numbers will tripple in December, when the does kid for the second time this year).  I have a 20 hole rabbitry also.

I cannot keep up with sales, and currently sell myself out, as well as a fellow goat farmer who has 200 does.

The only way to gain, is start small, and hard work.  I've worked for every customer, and they all return to my farm, because of my outstanding customer service.

Start small, and work hard.  Set reasonable goals, atain them, and set new ones.

Starting small is a good way to go also.  It allows you to make some mistakes, and not go into debt to do so.

By the way, 45 acres (looking at more land in the hundreds of acres) permiculture farm, make our own fuel, grow our own fodder for the animals, pretty much self suficient.  My husband and I (extremely happily remarried) have NO debt, other than our mortgage.

If we cannot pay for it, we don't buy it.  That means all of our equipment (like our 4 tractors) all paid for with cash.

Another lady I know took out a $16,000 second mortgage on her house to get into meat goats (180 of them).  She is now in serrious danger of loosing her home as the goats she purchased sight unseen were total culls.  She is has lost almost 100% of her kid crops.  

I started with three goats, and I'm still building my herd, but my animals are outstanding, and HEALTHY.

You can do farming if you have the will and the drive.  You just need to keep seaking out the right chance.

Best of luck,

~Garnet

Homesteading/Farming over 20 years

Answer 3

I have 2 far-fetched ideas for you, but you never know...

Buy the winning lottery ticket, spend a third of it on land, a third of it on equipment, and save the last third for things you didn't think of or

Find yourself a farmer's daughter, work with the old man, and maybe you can afford to buy him out when he retires, which most farmers have a hard time doing!

I wasn't trying to be a smart alec here, but alot of people have dreams like yours.  The quarter section of land you used to be able to make a living on with the wife at home and raising a couple of kids is gone.  It's a great life, but hard to get started in.

Good luck though!

Answer 4

Try looking for farms in third world countries ... they're dirt cheap and your "no credit" status will not be a problem.

Answer 5

Lonewolf,  I see that you are a top contender in dream interruption. Maybe you had better take a close look at yours, because it is just not likely to come true.  Farming is a pretty hard living with at least enough money to put down as a down payment and very good credit to purchase the land and for operating expenses.  With no money and no credit and not enough experience, your dream of farming is pretty much just a dream.  Sorry that I couldn't give you better advice to make it come true.

Answer 6

If you are willing to relocate you can probably find farm foreclosures.  You can also look at government web sites that list areas where farmers have property financed by the govt and can not pay what is due.

People who have been raised on farms often have kids who do not want to carry on that tradition of hard work and isolation so they might be more flexible on prices selling directly. Also if they are having a string of bad years the banks may be looking to take over their property and sell it.

Their misfortune might be your good fortune. So don't give up on that. This is a good time to get into a life like that - just don't get trampled by people rushing to get out of that kind of life.

Answer 7

By having a lot of cash, at this moment.

Answer 8

Can you find some more people to get involved and form a co-op or commune? If everyone lives together, you can save some money for a down payment.

Answer 9

The only way to make a dream come true is to WAKE UP! If you can work hard, wait, fast (starve) and think on your feet you can definitely do it. This is what I would do in your situation. I would first learn to be a little patient and a little about business planning and management. If I had no money to do that I would volunteer working for food for a financial planner in a rural area. There I would learn how people apply for business loans in general and agribusiness loans in particular. How they plan and predict to be able to generate an income from a farm and how they would be able to return the loan and its interest over a period of time. I will also learn a little about soils, climate, agriculture, horticulture, viticulture,  irrigation, cattle and sheep. I will also learn about future markets and what farm produce will be in demand and at what price. After that I will decide what crops I should be growing that will sell well and at a higher income to weight ratio, and how long it would take before it could be harvested. I will then calculate the farm/plantation area that I would need to make a viable living. Then I will start looking at suitable rural places and their prices with the right kind of soils, climate and water availability (rain or irrigation) for the crops and the land area I have determined. I will then calculate what kind of income I would be able to generate (if I had the farm) and what kind of expenses (capital and running) I would have. Then I would calculate how much loan I would need to buy the land, and any more loan to establish the farm to make a regular income that will be greater than the total of my expenses, loan repayments and the interest and my own living expenses. I will then prepare a business plan and start talking to banks and venture capitalists to get more information about what kind of business plan they are likely to approve. I would also try to find suitable farms of desired size where farmer is thinking of selling and retiring because all his children have moved to the city and are no more interested in running the farm and he is feeling awfully depressed. Once I find such a farm that will enable me to meet my expected income I would present the business plan to the bank and at the same time make an offer to the old farmer. I assure you if you do exactly as suggested or better, you will have your own successful farm. Sure Banks do look at security which the land would offer and a good business plan always succeeds in getting a loan. Good luck.

Answer 10

You look at employment opportunities that the west has to offer.  www.captialpress.com and get a job with a decent paying outfit.  Most ranch/farm jobs include housing, utilities, beef, horses to ride, & salary.  I would recommend a cow/calf operation over a farm job though just because most farmers that I know of don't usually don't provide housing.

Then in less than 10 years you should have enough saved up for a down payment or even pay outright for a place of your own.

Christmas Valley, OR area has 80 acre pieces with well (but no irrigation) and no other improvements for $8,000.  And there is work to be found in that area for the bigger ranches & farms too....so you can get permits build your house as you can pay for the materials.  Building material auctions have everything you need to build a house for pennies on the dollar and I mean pennies.

I know quite a few people who have gone this route.  They then own their own place.  They are not in debt for it.  They don't owe anyone anything and they grow their own food.  They start out small and build from there.  Some have bough ten more 80 acre pieces next to and around their original piece and they run cows for other ranchers.  

Some raise game birds, have bunk houses or RV pads and charge hunters to hunt on their properties.

Going into debt to fulfill a dream is just not an option.  Working for someone else and getting paid for what you want to do in life is a good way to go.  The person you are working for is the one that is in debt up to their ears, they have the expenses, and you do not.  Just so you do your job, get paid, and you like what you are doing that is what is important to get what you want in the end.

Most, if not all, farmers and ranchers are very willing to teach you how to do whatever it is that needs done.  You just have to be willing to work.

I have a small place. 48 acres and I thought that I could keep up with all that needs done but I can't and I have been on farms and ranches all of my life.  I love having my own place but I am in debt ($155,000 at $1750 per month) and I have to work outside of the place to make ends meet.  On a good year the place would make $18,000 net.  On a good year where there are no breakdowns or a crop of hay ruined by rain etc....I own my own equipment.  I bought at auctions and from private sellers.  The equipment has all been around the farm a time or two and requires a lot more maintenance than new equipment would but I am not making payments on any of it.  If I had equipment payments I would have to work full time somewhere else so what good would new equipment do me? None.   I rake hay for a custom hay outfit in the summers besides drive truck 2 days a week.  The guy I work for has new equipment.  The tractor I drive is a 2007 John Deere 6200 (or something like that) air conditioning, stereo, cig lighter to charge my cell phone, lights all over the place, automatic push buttoned shifting, air adjust seat, the works...the rakes are New Holland Twin Hydraulic rakes...I can rake 20 acres an hour....then I go home to my International 503 tractor and Massey Ferguson side rake, eat bugs, and rake my own hay at the rate of 3 hours for 11 acres....but mine is paid for and while I could use the bosses tractor and rakes...(he charges me a discount rate per acre)...so I use my own equipment...

Or you could find the farmer/ranchers daughter and inherit a place.....or you could win the lottery....

Personally, if I had to do it over again, I would have stayed working for the salary that included the housing, utilities, company rig, and beef until I had the money to buy my own place outright.

Answer 11

Kind of funny that most people see farmers as poor.  You need a tractor, combine, sprayer, plows, trucks, tools, barn, and the land.  Your going to need a lot of money.  You really thought up a good dream.