Land Access
Leasing
Powerful Questions to Prepare for an Agricultural Lease
Article + Download
15 min read
Checklist of Questions to Address in Your Farmland Lease
Article + Download
5 min read
Farmland Leases Built to Last: Content and Legal Context
Video
120 minutes
Long-Term Agroforestry Lease Workbook
Book
4 chapters
Incubator Farm Lease Toolbox
Book
6 chapters
Purchasing
Land Equity
Land Purchasing Questions:
What legal issues should I be aware of if I buy farmland?
Buying farmland is no joke. It’s expensive, time-consuming and just plain difficult. But if done right, it can maximize your legal resiliency. Here’s how…
Buying farmland is an exciting and nerve-wracking endeavor, and usually involves forking over a significant chunk of change. Before you spend your hard-earned cash, it’s a good idea to make sure you are thinking through the potential legal issues that may arise when purchasing a farm. To help you do this, start by reading the Basics of Due Diligence on an Agricultural Parcel. This short tipsheet will walk you through researching the costs, responsibilities, and opportunities associated with a potential farmland acquisition. If you’re particularly harboring concerns about zoning and would like guidance on (a) how to research your zoning code and (b) how to move forward concerning a zoning code challenge, read Strategies for Navigating Zoning Codes and Challenges.
I need help creating a promissory note
Promissory notes can make the difference between friendships and family relationships thriving or diving. Here’s how to actually make one.
One farmland financing strategy is to borrow money from family, friends, or community funding groups. This can be a great alternative (or addition) to a traditional bank loan. However, don’t skimp on the details if you want to preserve good relationships and build legal resilience. A promissory note is the way to do this! We have a totally helpful resource to help you do this. Check out our Promissory Note Toolbox (37pgs.), which provides the legal tools you need to create your very own promissory note, including a checklist, a model promissory note, and a story to illustrate its utility.
I want to create a land sale contract or contract for deed
A land sale contract, also known as just a “land contract” or “contract for deed” is the “rent-to-own” of the real estate world. In a land sale contract, you basically pay rent every month in the same way you would if you were just leasing land, but your rent payments go towards building equity, the way they would if you purchased the land. However, take caution. Legal issues abound, and much of the risk falls to the buyer if we aren’t careful.
Learn about and manage the risks of a land contract with our Land Contract Toolbox (51pgs.). It provides the legal background and tools you need to create an effective agreement that reduces the buyer’s risk, including a checklist and annotated model land contract. A narrative story illustrates how this relationship can work, while helping readers envision their own story.
Family and/or friends are financially supporting my farmland purchase. What legal issues should I be aware of?
In some ways it can be much easier to finance your farmland purchase through support from family and friends. But, it’s not without its risk. Here’s what you need to know to maximize legal resilience and thriving relationships.
Whether it’s a gift, a loan, or a crowdfunding situation, friends, family, and community members supporting your venture is a fabulous way to begin. However, money from family members and friends are not without their issues…Sometimes it’s hard to know if Aunt Suzie meant to give you the money as a loan or…maybe as a gift? This can spell legal trouble and ruined relationships if you get that part wrong. Read our Legal Aspects of Purchasing and Financing Farmland (32pgs.), which explores financing strategies for purchasing land for your farm operation. You will learn the ins and outs of gifts, grants, crowdfunding, loans, mortgages, seller financing, investors, and land contracts, and the various related legal issues to be aware of with each of the strategies.
I want to buy land with other people. How do we do this?
Purchasing land collaboratively can be the solution to affordability while creating stronger social networks and greater resilience.
Purchasing land together with other like-minded folks can be a win-win. By pooling resources, individuals can access a potentially larger or more valuable property. By sharing the ongoing responsibilities of the mortgage payment (assuming the land was financed), the group may be more resilient against issues and obstacles into the future.
FSA denied my application for a loan, grant, or participation in a program, and I'm not sure if it was fair. What are my opinions to move forward?
Whether producers are concerned about a mistake, a policy change, discrimination, or something else, this guide helps folks charting a path forward after receiving an FSA denial or “adverse decision.”
But before we begin, let’s adjust our terminology. FSA calls applicants who are groups of persons that are unrelated and unmarried “entity applicants.” The term entity applicant is used because the individuals involved typically form an LLC, corporation, or other qualifying business entity. The entity is the applicant for the FO loan. In turn, the entity’s owners make binding commitments to FSA in their capacity as owners, just as an individual or married couple might do. However, the distinction is essential to understand how the criteria apply to an entity applicant. We will explain further, but for now, readers should recognize that we are calling groups of persons that are unrelated and unmarried “entity applicants.”
Land Leasing Questions:
Do I need a written lease for my farm?
You know you need a lease but…Why do you need to write it down?
Farmers are known for handshake agreements based on people keeping their word, as well as a sense of trust and respect in the community. But, when it comes to farmland leasing, a little paperwork can prevent troubles further down the road and also enhance the quality of the relationship.
I need help creating a lease
You know you need a lease for your farm or ranch business but… how do you create one?
You already understand the importance of having a written lease for your farm or ranch, but now the big question is: How do you actually create one? With so many options out there – hire a lawyer, go through an online legal service, use a template form on the internet, etc. – it can be overwhelming to make this happen. We’re here to help you minimize the overwhelm and get you started on creating a lease that meets your goals.
What makes for a "good" farm lease from a legal perspective?
Once you realize you need a farm lease, you’ll need to figure out how to make it an effective one. Here’s what you need to know.
Leasing is an increasingly popular vehicle for land access, especially for beginning farmers and ranchers. Leasing can be the best available option for producers to get on the land without significant capital investment. If you are in the process of searching for the right land to lease, read our Basics of Due Diligence on an Agricultural Parcel. If you’ve already identified land to lease, you will be among the majority of established producers who lease at least some land, with just as many acting as landlords to other farmers. With a lot at stake, we want to be sure every lease is a “good” one. But, what does that mean?
My landlord wants to terminate my lease – I need help!
Leasing agricultural land involves more risks than owning it, as you are always at the mercy of the landlord.
When it comes to terminating a lease, farmers may act quickly to protect their rights. Seek advice from an experienced attorney licensed to practice in your state as soon as possible. Our educational materials are not a substitute for the advice of a qualified attorney on a matter as sensitive and complex as terminating (or not renewing) a lease for agricultural or livestock property, where the stakes are often high.
I'm exploring a long-term lease, such as for agroforestry. Where do I start?
Long-term leases are crucial for agroforestry operations, or other farming methods that take many years to yield profits.
Although the need for a long-term lease arises in many types of farm operations, it’s especially vital for agroforestry. Agroforestry is one branch of regenerative agriculture that focuses on mixing agriculture with forestry. It has significant ecological benefits and can be a profitable venture for farmers. Many other farming models are emerging that depend on being able to make a significant and long-term investment in the land’s capacity to produce. But, these arrangements can take 15, 30 or even 50 years to become profitable. Leases of this length come with a unique set of potential legal issues.
Special lease situations like incubator farms and subletting
Incubator farms and also subletting situations involve sharing resources on the farm. Here’s how to do that effectively.
Farm incubator programs are sprouting up around the country as an innovative way to support beginning farmers. These programs typically involve leasing farmland to farmers in the incubator program, which means that multiple farmers will be leasing the same land. This can stir up some legal issues not found in an ordinary farm leasing situation. The same goes for subletting- farmers sometimes find they want to take a year off or use excess space, facilities, and resources to support other producers. Subletting can be a great solution.
Rent-to-own, aka Land Contracts and Contracts for Deed
If you aren’t looking to buy farmland with a mortgage, but you don’t want to “throw away” your money in your rent check every month, you may want to consider a third option: land sale contract. A land sale contract, also known as just a “land contract” or “contract for deed” is the “rent-to-own” of the real estate world. In a land sale contract, you basically pay rent every month in the same way you would if you were just leasing land, but your rent payments go towards building equity, the way they would if you purchased the land. However, take caution. Legal issues abound, and much of the risk falls to the buyer if we aren’t careful.