Working in Ag Lending

Farming proves to be a hard business day in and day out. It takes an extreme amount of tenacity to manage a farm, especially when it comes to the financial aspect of it.

No matter how financially viable a farmer strives to be, at some point in their life borrowing money will be necessary. A piece of equipment may break in the middle of a harvest or a new barn may need to be built immediately. Whatever the case may be, most will seek help from an agricultural lender like Tanner Winterhof, the vice-president of VisionBank of Iowa.

Lending a helping hand

With 12 years under his belt as an agricultural lender, Tanner has experienced the hardships and triumphs right alongside his clients. As an agricultural lender, he faces the task of meeting with farmers to determine if they are credit worthy and if the bank can invest in an operation until the farmer has the cashflow to repay a loan.

“We help them finance everything it takes for them to run a farm if the cash is not readily available,” Tanner said.

Agricultural lending allows a person to work directly with farmers to make decisions on how the bank will lend money and when the bank will and will not lend money.

Day-to-day, Tanner’s work keeps him mobile and out of the office. He begins and ends his day in the office with tasks such as managing file work, checking numbers and getting approvals. The rest of his time is spent building relationships with current and potential customers.

“My customers — I try to go see as often as possible,” he said. “Ultimately it seems like I begin the day in the office and then I end the day in the office, but in between it’s managing a relationship, having a quality conversation.”

Learning the business

There are multiple ways individuals can become an agricultural lender, but here are two of the most common.

  1. Work as teller, loan administrator or underwriter — An individual does not necessarily have to be a college graduate to become an agricultural lender. It is possible for someone to work his or her way up to an agricultural lender position by gaining banking experience as a teller, loan administrator or underwriter.
  2. Obtain a college degree in business, finance or accounting — An individual who aspires to enter the banking world at a junior level or assistant vice-president position in agricultural lending should obtain a college degree in business, finance or accounting. Tanner encourages those in the process of achieving a college degree to work part-time in one of the roles listed above in order to understand all aspects of the agricultural lending process prior to beginning a full-time job.


Looking toward the future

There will be an extreme demand to hire agricultural lenders in the near future. Here are four tips Tanner has for job candidates aspiring to become agricultural lenders.

  1. Brush up on your general agriculture knowledge — A good hiring manager for an agricultural lending position will expect a candidate to know the difference between a gilt and a barrow, a female and a male pig. The ultimate rule of a bank is to invest its money into a successful operation, which can earn the money back with a rate of return. In order to make that decision, an agricultural lender will need to monitor the collateral. You need to have some basic agricultural knowledge to help you determine the collateral.
  2. Work on your communication skills — Agricultural lenders spend most of their days responding to emails, making phone calls and having face-to-face conversations. It’s extremely important to be able to communicate good or bad information to clients.
  3. Understand the key financial ratios — Be familiar with the key financial ratios used to determine the creditworthiness of your clients, like the current ratio, a leverage position and a debt service cover ratio.
  4. Be yourself — If you are qualified for a position, it’s going to show through!

Follow Tanner on Twitter: @bankerman50003

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Alex Lowery