FINANCING THE EQUESTRIAN ESTATE

A CONVERSATION WITH AXOS BANK

When discussing the development or acquisition of an equestrian estate, conversations often center around architecture, land planning, construction, and design. Yet behind nearly every successful project is another critical component: the financial strategy supporting it.

From raw land acquisitions and custom construction to complex estate transitions, equestrian properties often require a more nuanced lending approach than traditional residential real estate. As the first banking institution to join the Luxury Equestrian Network, Axos Bank brings a perspective that aligns closely with the collaborative nature of these projects — working alongside real estate professionals, builders, owner’s representatives, and property owners navigating highly customized estates.

We spoke with the Axos team about portfolio lending, financing equestrian properties, and the importance of integrating lenders into the advisory team early in the process.

How early should financing conversations begin when someone is considering the purchase or development of an equestrian estate property?

Knowing that borrowers arrive with a broad range of backgrounds, experience, and resources, the first step is determining either their purchasing power (if buying) or borrowing power (if they already own the property). Unlike traditional lenders that expect a borrower to fit into the proverbial “box” regarding income, job history, and credit, Axos is a true portfolio lender, meaning we take a holistic view of the borrower’s overall strengths, including global liquidity, cash flow, and especially assets.

Portfolio loans are funded with the bank’s deposits and held on our balance sheet, which in simple terms means we have increased flexibility to make prudent, risk-based decisions and fund deals that make sense.

Many equestrian estate owners have financial profiles that may not fit conventional lending models. How does portfolio lending create flexibility in those situations?

In a typical underwriting situation with conventional loans, a borrower must meet strict lender guidelines for debt-to-income ratios, time on the job, and often maintain a flawless credit profile. If a borrower fails to meet the standard in any one of those categories, it can often mean a denied loan request.

Portfolio underwriting allows us to look deeper into the overall financial picture. We understand that a credit score may not tell the whole story. You may have a borrower with exceptional collateral, substantial post-closing liquidity, and significant assets, yet perhaps a lower reported AGI or a credit profile that does not fit conventional parameters.

In situations like these, we can apply an income calculation to the assets under our Asset Depletion program and successfully fund a loan with Axos. Prospective borrowers can also continue working with their preferred mortgage professional, as we work directly with mortgage bankers and brokers to provide these programs.

In situations like these, we can apply an income calculation to the assets under our Asset Depletion program and successfully fund a loan with Axos. Prospective borrowers can also continue working with their preferred mortgage professional, as we work directly with mortgage bankers and brokers to provide these programs.

Equestrian properties often fall outside the parameters of traditional suburban real estate. How does your team evaluate larger acreage and specialized equestrian facilities?

Generally, we do not have specific acreage restrictions. That said, we do need to understand market values in relationship to both the structures and the usable land. Depending on the geographical location of the property, acreage may either enhance or complicate the lending picture.

For example, in markets like Rancho Santa Fe, estate-quality homes on acreage are common and well understood. In other regions, properties with large acreage may require additional evaluation. The important thing is having the necessary conversations with both your real estate advisor and lender early in the process — ideally before an offer is made.