Land Financing Rates For 2021 | Great Days Outdoors

Land Financing Rates For 2021

Alabama Ag Credit (AAC) is a financial coop with nine locations in Alabama serving 40 counties in Central and South Alabama. It provides financing for farm, timber and forestry operations, rural real estate, agribusiness, equipment and livestock and recreational and hunting landKeith McKinley is AAC Relationship Manager based out of Monroeville.  He points out that land financing rates for Alabama have trended downward all year long.


Land Financing rates 2021

With land financing interest rates trending down, now is a great time to work with a financial institution to find that piece of land you have always wanted.




“I will say that, in the last few months it has leveled off due to the election,” McKinley said.  “While our land financing interest rates don’t follow the Treasury exactly, they do trend with them and it has resulted in a long of folks inquiring about financing.”

“It is supply and demand and, in my conversations, I found that some people are pulling money out of the stock market or their depository accounts and putting it on tangible assets that they can put their hands on,” Mckinley shared.

McKinley pointed out that the size of parcels sold are increasing.

“In our market we see a lot of 80-to-120-acre tracts but this year (2020) we’ve seen a jump in the larger tracks,” McKinley said.  “Where we are at, there is a lot of property held by timber companies and trusts and normally timberland doesn’t trade that frequently here but this year the larger tracts have.”

“In 2020 not only the number of inquiries and loans have increased, but also the average tract land size has increased as well,” he said.



According to McKinley there are a lot of components, including credit, financials, loan-to-value, the type of property, the length of term and other variables.

“The longer term you have, the longer the rate lock and the higher the rate but the lower the payment,” McKinley explained.  “Some people are rate buyers and some people are payment buyers and we try to make both happy if we can and we don’t get paid to say no.”

When you borrow from Alabama Ag Credit, you become a stockholder and part owner in the cooperative, entitling you to a portion of the earnings (patronage) when the association does well financially. The more you borrow, the bigger your share of earnings.  

“For the last eight or nine years the patronage has reduced the stated rate by around 95 basis points and it is a return on the stock that they invested at closing and we are thankful and proud to be able to offer it.”


Current Alabama Ag Credit Land Financing Interest Rates (As of 1/10/21)

5 year – 3,20

7 year – 3.27

10 year – 3.44

15 year – 3.74

20 year – 3.97

30 year – 4.27



Keith McKinley

Monroeville Office – (251) 743-2865

CP – (251) 229-9019


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