Frequently Asked Questions

Answers to the most commonly asked questions about Alabama Farm Credit are below. If you have questions not covered in our FAQs, please contact us.

The Organization

Our success is your success and, as such, we will always have your best interests in mind.

No, we can make loans to anyone  looking to purchase rural land, home construction, or Agricultural assets. 
Yes, we make loans for the purchase, construction and improvement of homes located in rural areas. We also finance  rural homesites where a home is designated for future construction.
We make  loans to purchase land, refinance existing mortgages and other debts, construct and repair homes and other buildings, make property improvements, construct or improve agribusiness facilities, purchase machinery and equipment, purchase livestock, finance agricultural operating expenses and other needs.
Our association is part of the nationwide Farm Credit System and is affiliated with the Farm Credit Bank of Texas, located in Austin, Texas. The Farm Credit Bank of Texas provides funding for loans by selling bonds to investors in the nation's money markets.
Anyone owning or purchasing rural property. Those engaged in farming, timber or other ag-related businesses may also be eligible. This includes individuals, partnerships and corporations. Additionally, loans may be obtained for financing part-time farms, rural residences or recreational property.  Loan approval and terms are subject to the creditworthiness of the applicant(s) and the collateral offered.
Borrowers become part-owners in the association through stock purchases determined by the amount of the loan. Borrowers have the right to vote on certain co-op decisions, including the election of its board of directors. Because Alabama Farm Credit is a  cooperative, profits often are returned to  stockholders through patronage or dividends.
We offer an interest-bearing future-payment fund/funds-held account for our borrowers. Interest earned is applied to the interest due on the next loan installment. Borrowers can use the money in the funds-held account to pay loan installments or withdraw it for other purposes.
Yes. As of the date of this disclosure, Alabama Farm Credit meets or exceeds the minimum permanent capital adequacy standard established by the Farm Credit Administration and the standard set by the association board.

Voting Stock

We support the cooperative principle of sharing our success with our members.

A dividend refund is based on the proportion of interest earned on their loan to the total interest earned by Alabama Farm Credit. In this way, Alabama Farm Credit is able to return, to its borrowers, a portion of the interest paid on their loan.
Farmers, ranchers and producers who obtain a loan are required to purchase voting stock. Our  borrowers are considered members of Alabama Farm Credit, and have the privilege of being a voice within the cooperation. Your right to vote, in accordance with the Farm Credit Act and Alabama Farm Credit bylaws, allows you to elect the members of your Board. These members work closely with Alabama Farm Credit to ensure that your needs are addressed.
Farmers, ranchers, producers or harvesters of aquatic products who obtain a loan are required to purchase  voting stock. The stock includes the right to vote on all matters on which stockholders have the right to decide, in accordance with the Farm Credit Act, regulations by the Farm Credit Administration and rules in Alabama Farm Credit's bylaws.

A holder of  voting stock is entitled to:

  • nominate and vote to elect directors of the association's board of directors;
  • vote in the selection of members of the nominating committee;
  • make motions and second motions at the annual stockholders' meeting;
  • vote on measures brought before the meeting;
  • vote on certain other matters relating to corporate governance.

In addition, a  voting stockholder is generally eligible to serve as a director or as a member of the nominating committee.

Borrowers obtaining  loans for rural homes and certain farm-related businesses are not eligible to hold voting stock, but borrowers must instead purchase  participation certificates. In addition, persons who are eligible to borrow may purchase participation certificates in order to qualify for finance-related services. Owners of participation certificates do not have voting rights, with the exception of when stockholders authorize the issuance of preferred stock and are not eligible to serve on the association's board of directors. In all other respects, stock and participation certificates have the same rights and restrictions.
The minimum level of stock-purchase requirements for loans and finance-related services is determined by the association's board of directors within a range set forth in the association's capitalization bylaws, which are subject to the approval of stockholders. Currently, the required stock investment is the lesser of 2 percent of the borrower total relationship or $1,000.
Your association issues a receipt for stock and participation certificates at the time they are issued. Ownership of the stock or participation certificates is recorded on the books of the association.
Yes, owning stock or participation certificates may make you eligible to  receive patronage refunds or dividends. Patronage refunds are based on the amount of business you have done with the association, and dividends are based on the number of shares of voting stock or participation certificates you hold. Declarations of patronage and dividends are made at the sole discretion of the board of directors upon review of the association's financial performance.
The $5 per share par value of your association stock or the $5 face value of your participation certificates does not change, but the book value could increase or decrease depending on the financial condition of your association. Any retirement, however, will be at the lower cost of par value or book value.
The association will have a first lien on your  stock or participation certificates as additional collateral for your loan(s) or any other indebtedness to the association. In the event of a default on the loan(s), all or part of the stock may be applied to the loan(s), or under certain circumstances, may be otherwise disposed of as deemed to be appropriate by the association.
Your ownership of stock or participation certificates is an investment that allows you to  share in the association's earnings through patronage refunds and/or dividends, but which is also subject to certain risks that could result in a partial or complete loss of the investment. It is not a compensating balance. The ultimate value of the stock is dependent on the future financial performance and condition of the association over time. Therefore, you cannot assume that stock will be redeemed on demand or upon a certain date or upon the happening of any event, such as a repayment of the loan (as could be the case if the investment were considered a compensating balance). You are responsible for the full amount of your loan, including the amount borrowed to pay for your stock or certificates, regardless of their book value. Members are advised to review the  financial reports of Alabama Farm Credit, the association's capitalization bylaws and other available information about the Farm Credit System, copies of which are available from the association upon request.
If the association is liquidated, the law prohibits stock retirements until the assets of the association are used to meet its liabilities. The remaining assets after the liquidation is completed are all divided on a pro-rata basis among current stockholders, according to the proportion of stock they own.

Stock requirements are at the sole discretion of the board of directors based on the association's capital strength and financial performance. They cannot be retired on-demand or on a certain date. However, the association board has policies and procedures to maintain adequate capital and allow for the orderly retirement of stock, when requested by a stockholder, in a safe and sound manner.

When you have repaid your loan and finished with your financially related services, one of the following may happen:

  • You may elect to use the stock value to capitalize other debts with the association.
  • Your stock may be retired, and the proceeds repaid to you either when your loan is repaid or at a future date as determined by the board of directors.
  • Stock will not be retired if the association fails to meet the capital adequacy standards of both the Farm Credit Administration and association bylaws.

Our Loans

Our loan programs are customized to meet the needs of borrowers just like you.

Requirements may vary depending on the type of loan. You can always get started with the loan process by clicking here or contact one of our loan officers at a branch near you.

Also, check out our loan calculator 



Click here for more information on what you may need to apply for a loan or contact a loan officer at a location near you.

The minimum level of stock-purchase requirements for loans and finance-related services is determined by the association's board of directors within a range set forth in the association's capitalization bylaws, which are subject to the approval of stockholders. Currently, the required stock investment is the lesser of 2 percent of the borrower total relationship or $1,000.
Primarily, the nature of the loan, its purpose and the financial capacity of the customer determine repayment options. Repayments are set up to coincide with the borrower’s cash flow. They also may be paid in installments from farm operations or non-agricultural sources.
All real estate loans must be secured by a first-lien mortgage on real estate, generally on the farm, timberland, agribusiness or rural home that is financed by the loan. Operating, equipment and livestock loans are generally secured by inventory such as crops, livestock, equipment, receivables or other assets of the operation being financed.
Ag Banking Online allows you to view loans, unpaid principal or available commitment, interest rates, current amount due and interest paid year-to-date. You can schedule one-time loan payments or recurring payments (daily cut-off times and restrictions may apply).

The Mobile App

Download our ios or android app for more access to your loan information.

Yes. You can add alerts relevant to your banking transactions in the app’s personalized settings feature.
Users can view accounts and transactions, but this  online banking tool also allows users to make payments and other transactions (daily cut-off times and restrictions may apply). You can also schedule future one-time payments, set up recurring payments or add alerts and reminders.
Get the free mobile app by searching “Alabama Farm Credit Ag Banking” on  Apple App Store or Google Play.