Why was Cropland USA developed?
- Cropland USA was a spontaneous idea that arose from a group of professionals and friends in closely associated fields who realized how often sellers failed to capitalize on the sale of their cropland. Either they didn’t get the best price, or they had poor tax strategies, or they failed to capitalize by making unproductive investment decisions, or made some other mistakes that kept them from capitalizing on they sale of their land. These allied professionals realized that for a seller to capitalize on the sale of cropland the best way was to use a holistic look at the entire process, and understand the current and future goals of the seller. They decided making a team of professionals available to a seller was the best, fastest, and safest strategy for a seller.
What is so different about the way Cropland USA markets cropland?
- Cropland USA has found over the past 20 years that most cropland sales tactics are more helpful to the buyer than the seller and rarely allow the seller to achieve the actual top market value of their land. Most cropland sales programs fall into 2 categories. One is a traditional listing where the seller sets an asking price, or two, an auction of some sort. Cropland USA massive marketing and advertising program puts buyers in a position where they don’t know who, or where their competition for the land is coming from, nor do they know what their competition is willing to pay. That uncertainty forces buyers to make their first offer their best offer. Give us a call for details on how this would work for your situation.
Wouldn't it make sense to use local real estate brokers instead of Cropland USA?
- On the surface this would seem to make sense. But from a practical point of view we’ve found that local brokers tend to cater to local buyers and want to keep them on their good side. By comparison Cropland USA has only one motivation and that is to achieve the highest possible results for the seller, and so feels no need to curry favor with local buyers. In addition, since Cropland USA is a larger regional organization buyers can’t predict where their competition for cropland comes from. Will their competition to purchase the land be from Kansas City, Omaha, Chicago? This keeps local buyers from getting comfortable and encourages them to pay more.
Do you handle pasture, and recreation land as well as Cropland?
- Yes we do handle those types of sales. While they typically don’t attract the same sort of competition as does land that is primarily used for crops Cropland USA can still help sellers achieve premium results
Do I have to use all of Cropland USA’s professionals? What if I have my own attorney, CFP, etc?
- Cropland USA is glad to work seamlessly with any professionals you currently use. We have just seen all too often how a seller loses value in the sale of cropland by not having a team of professionals look at all the possibilities to capture value, before, during, and after the sale. So we have developed a team of highly seasoned experienced professionals and you can use all, or any of those professionals as best suits your situation.
How much experience does Cropland USA have in selling cropland?
- While the organization is new, the professionals who are part of Cropland USA all have a minimum of 20+ years in their fields of expertise. Not only are they experts in their fields, but they also are experts in agricultural sales, support, and post-sale investing. The real estate brokers all have over 20 years of experience, including working for large Farm Management companies, and have sold hundreds of farms over the years. All the professionals with Cropland USA are experts in their field in helping sellers capitalize on the sale of the cropland and are now working as a team when it makes the most sense for a seller.
What is a 1031 Exchange?
- A 1031 exchange, also known as a like-kind exchange, is a tax-deferred real estate investing strategy that allows investors to defer capital gains taxes on the sale of an investment property. A 1031 exchange allows an investor to exchange an investment property for another property of similar or greater value. To qualify for a 1031 exchange, the properties being sold and purchased must be “like-kind” properties, which means they must be of similar nature, character, or class. This includes any kind of real estate, whether it be agricultural, residential, commercial, or industrial.
What does “like kind” property mean? If I sell farmland do I have to buy more farmland?
- For real property transactions (rental houses, farmland, office buildings, strip malls, etc.) the “like-kind” requirement does not mean selling and buying the exact same type of property. The term “like-kind” refers to the nature or character of the property not its grade or quality. For this reason, nearly all real property is like-kind to each other. So no you don’t have to buy more farmland. Our 1031 Qualified Intermediary would be glad to discuss this with you.
Does vacant land qualify for a 1031 exchange?
- Yes, vacant land can qualify for a 1031 exchange.
How long do I need to hold on to the replacement property?
- One common rule of thumb is the “two-year rule.”
What time limitations apply in a 1031 exchange?
- Identification period 45 days- Identify the next purchase and a total of 180 days for closing on the next purchase. There are exceptions to these rules so please contact to discuss your particular situation.
Is it necessary to consult with a Certified Financial Planner before I sell?
- No, it's not absolutely necessary. However, since it costs nothing to sit down and explore whether they can assist you, there’s really no downside in having the conversation.
How Can a CFP Help?
- A Certified Financial Planner (CFP) takes a holistic approach to your financial well-being, considering both your current situation and long-term goals. They assess key areas such as taxes, income planning, investments, estate planning, and healthcare. From there, they craft a personalized strategy designed to help you achieve your objectives in the most efficient and effective way possible.
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How involved is your RE attorney in a sales transaction?
- Our attorney is available to review all documents, clarify issues and provide guidance throughout the entire transaction. We have found that having this additional perspective is invaluable to assure our clients have all the information they need to make prudent decisions.
Why is it important to have an attorney available in the transaction?
- An attorney can spot issues and provide guidance on all aspects of the cropland transaction, including assuring the contract is drafted with the clients’ best interest in mind, reviewing the title report to assure good and marketable title can be provided, and consulting with the client as questions arise.
What’s the Difference Between a Financial Advisor and a CFP?
You might be thinking, "Does it really matter? Aren’t they all the same? Not quite. Let’s break it down
Financial Advisor:
• A broad term for professionals who offer financial advice, including financial planners, insurance agents, and investment advisers.
• It’s not a specific regulatory designation, so the qualifications and expertise can vary widely.
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Broker:
• A professional who handles the buying and selling of financial securities for clients, often earning commissions on these transactions.
• Typically works for a brokerage firm and is regulated by the Financial Industry Regulatory Authority (FINRA) in the U.S.
Registered Investment Adviser (RIA):
• An individual or firm that provides investment advice for a fee.
• Regulated by the Securities and Exchange Commission (SEC) or state securities authorities.
• RIAs must adhere to a fiduciary standard, meaning they are legally required to act in the best interests of their clients.
Certified Financial Planner (CFP):
• A CFP goes through rigorous training, education, and certification to specialize in comprehensive financial planning.
• They are held to a fiduciary standard and must meet ongoing education requirements to maintain their certification.
By understanding the distinctions, you can make a more informed choice based on your financial needs.
I Still Have Questions!
Want more information? Contact us today and we can answer all your questions.