Beginning Farmer Loans

[Jake]

I know this is the breeds board, but I don't ever visit any others and may forget to go look if I post it over there.


Anybody ever used this FSA program to purchase a farm? Looking at buying my first piece this fall and the interest rates on these programs is enticing but I don't know what kind of wonderful govermental loopholes or leins you have to deal with for 40 years.

Any advice?

 

[circlebllc]

No loopholes or hidden agendas. Some are afraid cause it's the government. We all pay for it, why not use it. Nothing hidden, all out front. The do seem to check on their collateral more than banks. One on site visit per year( up to), for land and operating loans. Can't beat 1.5% land loan. I have had very good luck and other assistance from them. You will hear lots of negative about it. A lot has to do with you local branch.

 

[Jake]

No loopholes or hidden agendas. Some are afraid cause it's the government. We all pay for it, why not use it. Nothing hidden, all out front. The do seem to check on their collateral more than banks. One on site visit per year( up to), for land and operating loans. Can't beat 1.5% land loan. I have had very good luck and other assistance from them. You will hear lots of negative about it. A lot has to do with you local branch.

I don't qualify for the 1.5% rate. The cheapest I can get is 3% but that is still cheaper money than I can get anywhere else. The one program requires no down payment which is nice but also a little scary. The only thing that allows is for me to by cattle with cash to run on it and/or buy another farm.

 

[Bigfoot]

This subject comes up on these boards frequently. I thought you had to be unable to borrow money were else to qualify for a loan there. Does anybody know if this is true?

 

[Santas and Duhram Reds]

My personal story several years ago was I was too wealthy and didn't need the assistance in their eyes. The regular banks would finance me so I didn't qualify. on the other hand FCS wouldn't approve me because i wasn't wealthy enough even though I had proof I could pay for the place not counting the income the place would make itself. So now I am stuck with a loan without a fixed rate which scares the dickens out of me.

 

[TexasBred]

Jake I've seeen some folks mention the beginning farmer loans at FSA but really don't know anything about them. Heck I'd just walk in all dirty and sweaty and ask them every question that comes to your mind. I'm sure like everything else they'll want a lot of paperwork but that's just the way it works. Go get'em !!

 

[Jake]

My personal story several years ago was I was too wealthy and didn't need the assistance in their eyes. The regular banks would finance me so I didn't qualify. on the other hand FCS wouldn't approve me because i wasn't wealthy enough even though I had proof I could pay for the place not counting the income the place would make itself. So now I am stuck with a loan without a fixed rate which scares the dickens out of me.

that's what scares me the most. Only have a fixed rate for 7 years throught he bank at 5.whatever% or 3% fixed for 40 years through FSA. I have saved enough to put a big chunk down but it would limit me to buying just one of the two farms.

 

[MistyMorning]

We got a 7 year one for infrastructure and it was great for getting things up and running. The biggest downfall was all the year end paperwork, it made me mental.

 

[circlew]

I talked with my local guy two weeks ago about the young farmers loan for chicken houses and the land to put them on. He said they would do 90 percent and I had to have the other 10 percent worth in cash or collateral of some kind or have a family member put up the collateral. If I could get the 10% collateral then they would do 100% - whatever I paid with cash.

 

[jedstivers]

If you can stand the paper work then do it. Buy any land you can. Only thing is variable rate, never ever do variable. Take it from someone that survived the 80's.

 

[Beefy]

do it Jake! i am and have. where else can you get interest rates that low, set, for 40 years!? the only drawback is a buttload of paperwork AND having to wait on the money to become available (meaning you cant just hear of some land coming up for sale and apply for the loan and get the money in time to buy it, necessarily) . i have had three different cattle loans at these low interest rates and am approved for a land purchase loan already, just on the waiting list to receive the money. for example i applied for this loan in february and although approved, i may not see the money until september (when their new year starts) but i am buying from family so not in a rush to get the money anyway.

 

[TexasBred]

If you can stand the paper work then do it. Buy any land you can. Only thing is variable rate, never ever do variable. Take it from someone that survived the 80's.

Jed if you did a variable in the 80's it couldn't do much of anything but go down. :lol: Wouldn't think of signing one in today's market because it can do nothing but go UP.

 

[ALACOWMAN]

wish i had bought during the 80's

 

[Jake]

wish i had bought during the 80's

Hell if I was ten years older, its amazing how much further my $$ would have gone.

 

[ALACOWMAN]

wish i had bought during the 80's

be nice if I was ten years older, its amazing how much further my $$ would have gone.

if i were 10 years older id be dead :cowboy:

 

[jedstivers]

If I was 10 years older the 70's would have killed me.

 

[OldCrow]

Jake,

My wife and I just went through the process and closed last Friday. We submitted all the paperwork back in March just to let you know the time frame it takes, but it could take longer according to the FSA agent(up to 12 months depending on what time of the year it is). I had a great experience working with the local FSA. Granted it is a lot of paperwork, but that is it, just paperwork. Who wouldn't take a few extra hours to save thouasands of dollars over the life of a loan. For me it was a comparison of FCS at 4.25 to% to 3% at FSA. It is going to save us almost $2000 in interest the first year alone which is well worth the time it takes. There are no hidden gimics although the FSA program I used did require me to have 1.5 times the amount of original farm purchase price in colatoral. Overall it went good, on a scale from 1-10 for ease I would say an 8. They send you all the forms stating what is needed from you, what takes up time is if you don't have what is asked for then it can become a back and forth game. If you have any questions they should be glad to help. One of the reasons they exist is to help farmers across this great nation and not to forget it's our taxmoney that pays them.

OldCrow