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Capital & Intermediate Term (IT) Loans

[Features & Benefits]   [Frequently Asked Questions]   [Interest Plans]

These are intermediate term loans used to finance equipment, breeding livestock or other capital items for up to 7 years and specialized facilities/equipment for up to 10 years. They can also be used to restructure a borrower's balance sheet to provide additional permanent liquidity (working capital).

Capital loans are available to a wide range of individuals and entities that are eligible for Farm Credit loans. In addition to full and part-time farmers, this product can be used for aquatic producers, harvesters of forestry products, providers of farm marketing and processing services, contract growers, and farm-related businesses.

What are the loan plans?

• Variable Rate (30 Day Adjustable): Customer's rate may change on the first of every month.
• Prime Indexed Loans: The customer's rate will be indexed to the Prime Rate as reported in the Wall Street Journal. The rate will be adjusted on the first of every month based on the Prime Rate as of the 10th of the previous month.
• Adjustable Rate: Adjustable rate loans may be priced on 1-, 2-, 3- or 5-year repricing periods.
• Fixed Rate: The rate is fixed for the entire term of the loan, so there are no balloon payments. Fixed rates are available for terms of up to 10 years.
• Other terms: The loan may be secured or unsecured as required by credit procedures. A single disbursement is usually made at loan closing. However, a budget may be established for future purchases during the operating cycle and disbursements made when purchases are completed. Payments of principal and interest may be made monthly, quarterly, semi-annually, or annually, based on an equal or decreasing payment schedule.

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Features and Benefits

Feature	Benefit
Terms up to 7 years if secured by machinery or breeding livestock and 10 years if secured by facility/equipment/real estate	Longer terms can reduce the size of your payments. This can help improve your cash flow
PAID option: Automatic withdrawal of payments (Pre-Authorized Installment Draft)	Our PAID option allows your payment to be automatically deducted from your bank account, which saves your time and money.
Loan term is tailored to the useful life of the asset	Our loan terms assure that you're not still paying for an asset that is physically depreciated.
Fixed principal or amortized plans	Fully amortized equal payment schedule or decreasing payment schedule with fixed principal payments. Payments can be scheduled to be due monthly, quarterly, semi-annual, or annually. Choose the principal repayment plan that matches your cash flow. We'll work with you to establish a payment schedule that suits your cash flow.
Simple interest	Reduce your interest expense by paying interest only on actual funds borrowed.
Conversion option	Presently, we offer a convenient option that allows you to change from one pricing plan to another at any time, something that many lenders will not do. This option is generally less costly and simpler than refinancing.

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Frequently Asked Questions

Question	Answer
How long will I have to repay my loan?	To determine the maximum loan term for the specific item you want to finance, we consider the item's useful life. For example, we know that an XYZ tractor generally has a useful life of 5 years. Therefore, you can take up to 5 years to repay that tractor loan. By matching the item's useful life to the loan term, you're assured that, down the road, you won't continue to make payments on an item that is physically depreciated. That makes good business sense for us and for you.
How can a GreenStone loan be better than a manufacturer's 0% financing program?	Two things must be understood when considering a 0% financing program: The rate on the loan after the no interest period has expired, and the ability to take a cash discount in lieu of the 0% offer. In most cases, the rate on the loan after the 0% rate has expired is higher than current market rates. In addition, there is often an option to get a discount on the time being purchased if you pay with cash. Therefore, by obtaining a GreenStone equipment loan, you can take advantage of the cash discount and realize lower interest cost over the entire life of the loan.

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Interest Plans

Interest Type	Index	Repricing Frequency	Maturity Min/Max	Comments/Features
Variable/ 30-day Adjustable >>> rates	GreenStone determines rate.	Monthly	120 months maximum	Most common product used
Adjustable >>> rates	GreenStone determines rate.	1 year 2 years 3 years 5 years	60 months maximum	At repricing, loan automatically re-prices to same product code. For example, a 3-year adjustable re-prices to another 3-year product.
Prime Indexed >>> rates	Prime Rate as quoted in the Wall Street Journal	Monthly based on the Prime as of the 10th of the previous month	36 months maximum	Bill rate can be indexed to Prime for 1 or 3 years. At end of 1 or 3-year period, the margin will automatically reset to the current margin in effect.
Fixed >>> rates	GreenStone determines rate.	1 year 2 years 3 years 4 years 5 years 7 years* 10 years*	6-12 months 13-24 months 25-36 months 37-48 months 49-60 months 61-84 months 85-120 months	These loans do not re-price. No prepayment penalties.
Special Products: "Preferred Capital Line" is a revolving line of credit for up to 5 years, which offers drafts as the disbursement vehicle. * Available in Flex and Exceptional Rate Options.

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