Cattle Expansion Funding

[TTBHG]

I've financed my entire herd out of my pocket. I'm a first generation cattleman I started with nothing and I'm up to over 230 head in three years. I have the ability to expand again but at some point I'd like to use a loan instead of continually funding it out of my pocket.

Is there special funding programs through USDA/FSA or is my play here to go to the bank or Farm Credit?

This board has been an amazing resource for me. Thank y'all for the continued help.

 

[SBMF 2015]

Yes there are term loans you can get through the Fsa. Usually with lower interest and longer terms than a bank will lend on cattle.
If I had the ability to buy them out right I wouldn't even think of borrowing the money.

 

[kenny thomas]

There are many opportunities through FSA for first time farmers.
Also cost share through NRCS at higher rates of payments for improvement to the farms.

 

[TTBHG]

Yes there are term loans you can get through the Fsa. Usually with lower interest and longer terms than a bank will lend on cattle.
If I had the ability to buy them out right I wouldn't even think of borrowing the money.

I've bankrolled this deal out of my pocket for multiple years. At some point I'm ok with paying a few percent in interest to be able to collect a paycheck. I haven't made a cent yet. Every heifer or steer calf I've sold has instantly turned into more bred heifers/heifers and started the process over.

 

[kenny thomas]

The new farmers loans are designed to help people get started at a very low interest rate. Go for it.

 

[SBMF 2015]

I've bankrolled this deal out of my pocket for multiple years. At some point I'm ok with paying a few percent in interest to be able to collect a paycheck. I haven't made a cent yet. Every heifer or steer calf I've sold has instantly turned into more bred heifers/heifers and started the process over.

I understand where you are coming from. I work with the Fsa. They are good to work with, but the mountain of paper work and the requirements can be a lot.

 

[Stocker Steve]

There are many opportunities through FSA for first time farmers.
Also cost share through NRCS at higher rates of payments for improvement to the farms.

True, but that does not mean it is a good investment.

Are you in the land business or the cattle business?

 

[kenny thomas]

I'm in both. And either way the loans through FSA for new farmers and programs through NRCS for New farmers are a good deal.
Like 2% interest for FSA and 95% payments through NRCS. Notice I keep stressing NEW farmers. Not so great deal for people like me that have farmed for 50 years.

 

[Chevy]

I'd go talk to the Extension office about grants or what they would suggest. These farmers around here ballin' on some damn grants. This one guy have it set up to get grants every year, he leases and owns lands has it separate up to were he can pull that . He riding around in do whiskies driving new tractors should be sitting on dubs but he isn't that cool.....his eyes burn on the dub being. Ballin' on a farmers grant.

 

[Rafter S]

It's hard enough to make money in the cattle business without having to to make money for the bank too.

I've bankrolled this deal out of my pocket for multiple years. At some point I'm ok with paying a few percent in interest to be able to collect a paycheck. I haven't made a cent yet. Every heifer or steer calf I've sold has instantly turned into more bred heifers/heifers and started the process over.

I know I'm not very smart, so please explain to me why you need to borrow money to collect a paycheck. Why not just quit expanding and put some money in your pocket?

 

[kenny thomas]

I'd go talk to the Extension office about grants or what they would suggest. These farmers around here ballin' on some damn grants. This one guy have it set up to get grants every year, he leases and owns lands has it separate up to were he can pull that . He riding around in do whiskies driving new tractors should be sitting on dubs but he isn't that cool.....his eyes burn on the dub being. Ballin' on a farmers grant.

Well I'm sure your correct but the only part I understood was to call the Extension Office.

 

[TTBHG]

It's hard enough to make money in the cattle business without having to to make money for the bank too.



I know I'm not very smart, so please explain to me why you need to borrow money to collect a paycheck. Why not just quit expanding and put some money in your pocket?

Interest is tax deductible. Expansion is how you create wealth.

 

[Dave]

I am not afraid of some debt. It allows a person to take advantage of opportunity. Just don't get too far in. Be careful to keep it at a level that even if things go south you will still be able to pay it off. Example if I had 230 producing cows I would fell comfortable buying another 70 cows on credit. If things go in the tank 300 calves will still pay the piper. I use Farm Credit.

 

[Brute 23]

Interest is tax deductible. Expansion is how you create wealth.

Lose money to get a write off? Plus, it's not even 1:1.

 

[callmefence]

I'd go talk to the Extension office about grants or what they would suggest. These farmers around here ballin' on some damn grants. This one guy have it set up to get grants every year, he leases and owns lands has it separate up to were he can pull that . He riding around in do whiskies driving new tractors should be sitting on dubs but he isn't that cool.....his eyes burn on the dub being. Ballin' on a farmers grant.

Could you translate this into English please......

 

[SBMF 2015]

Interest is tax deductible. Expansion is how you create wealth.

You only pay taxes if your making profit.

 

[BFE]

Shell is fluent in Ebonics.

 

[BFE]

I use my local owned bank exclusively. Just sign and go write the check, not necessarily in that order. Never been turned down, but I figure if they ever did turn me down it would be in my best interest.

 

[Penantly72]

If the build back better bill passes it appears the FSA will be reducing all borrowers loans up to $150,000.

 

[snoopdog]

Interest is tax deductible. Expansion is how you create wealth.

MEH, taking your grandkids fishing is worth more than any herd of cows. Sunup to sundown, and every weekend is just not appealing to me anymore.