Ag Disaster Relief Loan Program – Ag Disaster Program

This program provides relief for North Dakota farmers and ranchers negatively impacted by extreme weather conditions in 2019. BND has set aside $300 million for this program. Funds will be allocated on a first-come basis.

Applications will be accepted until September 30, 2020 at 5 p.m. CT.

Can the loss only be from 2019 or can we go back and consolidate previous year losses with the 2019 loss?

There must be a 2019 loss to be eligible for this program. However, if a lender termed out losses from prior years, those term notes can be included with this disaster loan program.

Are there equity limits?

There is no minimum equity ratio or level. BND is relying on the lead lender’s experience with the Borrower to identify who will be a good fit for participation in the program.

Do shortfalls need to be a working capital related?

We expect many applicants will have a working capital shortfall and this program covers those scenarios. Additionally, there may be other adverse financial trends that will qualify an applicant for this program. Examples include a crop in the field, timing differences with insurance proceeds, and a decrease in net worth.

What are the loan limitations?

The total loan amounts are $1 million on chattels and $2 million on real estate. BND will participate up to 75% of the total loan amount not to exceed $1 million on chattels and $2 million on real estate.

How would/should 2020 chattel purchases (new loans) be handled with this program?

This program is not intended to finance new chattel purchases in 2020.

Do we need a certified appraisal on real estate?

We will use normal underwriting standards. A real estate secured loan over $1 million requires a certified appraisal.

Does BND have any third parties involved for chattel or real estate appraisals/valuations?

BND does not have a third party which provides appraisals/evaluations. However, BND may request the lead lender provide a third-party appraisal/evaluation in certain instances.

Can we separate some of the chattels for a shortfall instead of doing all farm assets pro-rata?

Yes, that may be acceptable. BND will evaluate each situation as presented and make a determination.

Is the lead lender’s assessment of 2019 shortfall/loss in credit write-up sufficient evidence or is there more diligence expected?

BND will assess the shortfall/loss based on the credit writeup and financials provided. If a situation arises where the shortfall/loss is not apparent, we may circle back with the lead lender to quantify the loss.

Can you provide more detail on BND to net 3.50% fixed for up to five years? Is the actual rate 3.50% on BND share if lead lender does not add a servicing fee?

The net rate to BND is 3.50%. If the lead lender does not want a service fee the net rate to the borrower will be 3.50%.

Can lead lender use variable, adjustable or fixed rate on its share as long as does not exceed outlined maximum rate?


Can closing fees be included in the mortgage loans?


Is separate (identifiable) collateral for the Disaster loans necessary?

If the lead lender does not want to provide a shared blanket lien, separate identifiable collateral will be required.

What does collateral to be shared pro-rata mean?

Collateral is pro-rata at time of liquidation. This would be the case unless there is a change to how collateral is viewed either at loan approval or a change in the situation at some later date.

The borrower must be a North Dakota resident whose principal occupation is farming or ranching or a North Dakota family farm entity. Evidence of operating shortfall for 2019 must be provided. Borrower must show the ability to repay and have an operating line approved for 2020.

This program will provide borrowers with the ability to carry over operating shortfalls, term debt payments, and to restructure existing debt, including BND’s Farm Financial Stability Program.

BND will participate up to 75 percent of the total loan amount, not to exceed $1.0 million on chattels and $2.0 million on real estate.

BND Interest Rate: BND to net 3.50% fixed for up to five years.

  • Lead Lender Service Fee: The lead lender will have the option to add up to a 0.25% service fee on BND’s participation. 

Lead Lender Rate: The interest rate charged on the lead lender share of the loan may not exceed BND’s Base Rate (Wall Street Journal Prime Rate) plus 2.0%.

BND Fees: BND receives a $250 origination fee.

Lead Lender Fees: Origination fees should not be charged, however, hard costs associated with documentation can be charged. 

Maximum loan to value ratio (LTV): 75% on chattels and 80% on unimproved real estate. Collateral to be shared pro-rata. For collateral purposes, any FSA loan secured by chattels or real estate may require FSA subordination.

  • Chattel: Up to a 10-year amortization with a 5-year balloon. The first 12 months may be interest only and will convert to permanent to be amortized over the remaining term.
  • Real Estate: Up to a 25-year amortization with a 5-year balloon. The first 12 months may be interest only and will convert to permanent to be amortized over the remaining term

Bank Participation Loan Application

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BND offers this loan by partnering with local lenders. To apply, contact your lender.

If you have any questions, contact us or call 701.328.5795 or 1.800.472.2166 ext 328.5795.