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Cattle loan question?
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<blockquote data-quote="js1234" data-source="post: 1388009" data-attributes="member: 17596"><p>I don't know much about banks in that part of the world. I've done some stuff with a couple banks up in the Panhandle that I'd give a good review but I understand that's a world away from you.</p><p>How many more you figuring on buying? </p><p>I'm not sure what a closeup calver is bringing in your country but a guy would get them bought out here between $1,500-$1,750 if calvy and 3-5 years old.</p><p>While there is plenty of money out there for good operators in the 3's on a line of credit, I guess on a cow note, it would be in the 4's.</p><p>Smaller deals, more leveraged operators and other factors might push it into the 5's.</p><p>Some may disagree but I think its asking a lot of a cow to settle up the debt in 3 years, IF you decide to finance her, better figure on her taking 4 years, maybe 5.</p><p>I'm not adverse to borrowing money from banks, we have really big lines of credit for stockers and cattle on feed and have a few of our more recently purchased ranches that have a ranch payment on them still. That said, to me, financing breeding stock is the least attractive way of borrowing within the cattle segment. To be fair, I could be biased by our own philosophy, we carry lines for stockers or feeders and will borrow money to buy a ranch but we only pay cash for mother cows. Just the way we roll.</p><p>That said, I don't think it's undoable and if the situation is right, I don't think you're foolish for doing it. I also recognize that it may be the only way you can get the volume of cows needed bought in the time frame that fits your grass deal. The rub is, in my view, you can only ask a cow to pay for one thing and if she's busy paying herself off, she can't do much else.</p></blockquote><p></p>
[QUOTE="js1234, post: 1388009, member: 17596"] I don't know much about banks in that part of the world. I've done some stuff with a couple banks up in the Panhandle that I'd give a good review but I understand that's a world away from you. How many more you figuring on buying? I'm not sure what a closeup calver is bringing in your country but a guy would get them bought out here between $1,500-$1,750 if calvy and 3-5 years old. While there is plenty of money out there for good operators in the 3's on a line of credit, I guess on a cow note, it would be in the 4's. Smaller deals, more leveraged operators and other factors might push it into the 5's. Some may disagree but I think its asking a lot of a cow to settle up the debt in 3 years, IF you decide to finance her, better figure on her taking 4 years, maybe 5. I'm not adverse to borrowing money from banks, we have really big lines of credit for stockers and cattle on feed and have a few of our more recently purchased ranches that have a ranch payment on them still. That said, to me, financing breeding stock is the least attractive way of borrowing within the cattle segment. To be fair, I could be biased by our own philosophy, we carry lines for stockers or feeders and will borrow money to buy a ranch but we only pay cash for mother cows. Just the way we roll. That said, I don't think it's undoable and if the situation is right, I don't think you're foolish for doing it. I also recognize that it may be the only way you can get the volume of cows needed bought in the time frame that fits your grass deal. The rub is, in my view, you can only ask a cow to pay for one thing and if she's busy paying herself off, she can't do much else. [/QUOTE]
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