Frequently Asked Questions

1. Who is Texas Land Bank?

Texas Land Bank is a locally owned and operated Farm Credit rural financing cooperative that was established in 1917. We are headquartered in Waco, Texas, and have six lending offices, which serve the greater Central Texas area. Texas Land Bank specializes in loans on farms, ranches, timberland, recreational property, agribusinesses, rural homes, livestock, equipment and agricultural operating needs.

2. What does it mean that Texas Land Bank is cooperatively owned?

Everyone who obtains a loan through Texas Land Bank becomes an owner of the association through the purchase of stock equal to two percent of their loan amount with a maximum stock amount of $1,000. Funds for the stock can be included in the loan. Ownership of this stock provides you the right to participate in the business affairs of the association, including election of the board of directors. Traditionally, borrowers are paid patronage and/or dividends, which further reduces the cost of borrowing for our customers.

3. What is a Patronage?

It is a distribution of part of Texas Land Bank's net earnings to its members. Each member's share of the patronage is based on his or her pro rata contribution to the Land Bank's profitability. The Board of Directors determines annually if the Land Bank will pay a patronage and what the total amount will be.

4. Who operates Texas Land Bank?

Texas Land Bank is supervised by a board of directors elected by the borrowers of the association. The directors employ professional personnel to manage the operations of the land bank. The land bank operates under policies and procedures adopted by the board of directors and management team.

5. Who is eligible to borrow?

Any person or legal entity that currently owns or is purchasing rural real estate, or who is involved in or plans to become involved in agriculture, is eligible to apply for a Texas Land Bank loan. Loan approval and terms are subject to the creditworthiness of the applicant.

6. What types of loans does Texas Land Bank make?

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, and provide agricultural operating capital.

7. Does Texas Land Bank make home loans?

Yes, we make loans for the purchase, construction and improvement of homes located in rural areas. We also finance rural homesites upon which a home will be constructed in the future. Texas Land Bank also offers loans through the secondary mortgage market (Fannie Mae Loans).

8. What collateral is required?

All real estate loans must be secured by a first-lien mortgage on real estate, generally on the farm, ranch or agribusiness facility 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.

9. How much can I borrow?

All loans require some level of equity, which is the difference between the appraised value of the real estate offered as collateral and the loan amount. The appraised value, financial strength and repayment ability of the applicant will determine the total amount to be borrowed. Down payment or equity requirements on real estate, livestock and equipment loans generally range between 15 and 25 percent.

10. Does Texas Land Bank accept deposits?

Texas Land Bank offers 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.

11. Where does Texas Land Bank obtain funds to make loans?

Texas Land Bank is a part of the national Farm Credit System and is affiliated with the Farm Credit Bank of Texas, located in Austin, Texas. The Farm Credit Bank provides funding for loans by selling bonds to investors in the nation's money markets.