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Loans

Pharmer20

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I may be in the market to buy some land in the near future, and wanted to find out the best way to go about getting a loan. Any advice would be great.
 

HerefordSire

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Pharmer20":1bxnhlxp said:
I may be in the market to buy some land in the near future, and wanted to find out the best way to go about getting a loan. Any advice would be great.

Tell us a little about yourself...for example:

Where do you live, do you have a down stroke saved, how many acres are you after, do you have a bank, do you have dependents, etc.
 

TC Cattle

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Check with your local FSA - they have some great programs, especially for beginners. The catch is that you must have the experience to back it up. If I remember correctly, it's something like 3-5 years in a management position.

Also, there is a wealth of knowledge out there. Google "land loans", "ranch/farm loans". Check with your local bank, etc.
 

Running Arrow Bill

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You probably need to following to get an agricultural loan:

  • 1. Personal Resume
    2. Business Plan
    3. Financial Statement
    4. Two to three years Income Statement
    5. References
    6. Extra collateral (if needed for loan)
    7. 20 to 30% cash down payment

If you don't have, don't know how to prepare the above, etc., contact a good CPA to help you put this info together.

Otherwise, you're shooting blanks into the wind... ;-)
 

SouthrnBlacks

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In Oklahoma you can go to a farm credit office, ask about first time farmers loan program.

You have to have 650 credit score , but it is a great deal 3% interest rate , and no money down, this was about the best deal I found around here when looking for a loan on land.
 

TexasBred

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Pharmer20":1yrxdf30 said:
I may be in the market to buy some land in the near future, and wanted to find out the best way to go about getting a loan. Any advice would be great.

Get a contract signed first, contingent on you obtaining financing. Then if you have a local banker you have a track record with present him with the contract, complete the application and "wait". He should be able to lead you thru the entire transaction, let you know what else he needs from time to time and look out for you and the bank thru the entire transaction. More favorable rates might be obtained thru some of the lenders that specialize in farm loans but dealing with "your" banker might be easier but don't expect any favors.
 

Santas and Duhram Reds

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Actually, I have the opposite experience. I made too much to be eligible for FSA. FCS turned me down when I had 790 credit score, made enough to buy the place, had over half of it up front to put down, and this information wasn't even considering the amount that would be made from the place itself once I acquired it. Talked to my local banker. He didn't understand what FCS problem was and I had the loan in 2 weeks. 3/4 of a point higher interest rate than what FCS could offer, so I am paying 30% over may minimum payment to compensate fo that.
 

LoveMoo11

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A good business plan is key. If you are looking for land for farming, see if your state has a program like we have, Maine Farmland Trust. They match new farmers up with farmers who are getting out of the business and selling them the farms at "farmer prices" rather than typical real estate prices.
 

Angus Cowman

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TexasBred":1c0d135k said:
Pharmer20":1c0d135k said:
I may be in the market to buy some land in the near future, and wanted to find out the best way to go about getting a loan. Any advice would be great.

Get a contract signed first, contingent on you obtaining financing. Then if you have a local banker you have a track record with present him with the contract, complete the application and "wait". He should be able to lead you thru the entire transaction, let you know what else he needs from time to time and look out for you and the bank thru the entire transaction. More favorable rates might be obtained thru some of the lenders that specialize in farm loans but dealing with "your" banker might be easier but don't expect any favors.
I agree with TB on most of these but if you have a good relationship with a banker go talk to him First before you sign a contract or start looking and wasting time and he will tell you what you can afford or what they are willing to do
it might save you alot of time and hassle
 

jcarkie

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my sons went through FSA they have money for young farmers who are starting out, you need a farm plan, it is a long term loan, low interest. my bro-in-law went through farm credit because he made to much money. it was good interest rate either way
 

TexasBred

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jcarkie":sksn95yt said:
my sons went through FSA they have money for young farmers who are starting out, you need a farm plan, it is a long term loan, low interest. my bro-in-law went through farm credit because he made to much money. it was good interest rate either way

BUT, if you don't plan to farm it and probably will run cattle only as a hobby you simply need to good credit, an adequate down payment and proof of your ability to repay or at least that was the way it was in the old days before 21st century banking hit the fan. Many of us buy land as investments so the only business plan would be to "sell it someday at a good profit".
 

bigbull338

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the 1st thing you must do is find a banker that you trust.an talk to him about what you want todo.an have a business plan an projections.i know how muxch money i can get in a loan without any hassle.just call an say i need X amount of money.an they take care of it.
 

TheLazyM

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Around here when I was looking into a agri-loan they would only loan 85% of the appraisel. So I just went to my bank got a preapproval so I knew what kind of money I could spend plus it locked me into a interrest rate.
I really think at this time the best thing would be to go to the bank with the interrest rates way down and get preapproved so you know just how much you can spend. THat way you can look for the place that best suits you, instead of what suits your wallet.
Just me thinking out loud.
 

TheBullLady

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I'm a Realtor.. and if you're planning on working with an agent when you're ready to purchase, any agent worth their salt will make sure you are pre approvedbefore they show you anything. That way you're not wasting your time, or the agent / seller's time.

FSA is a good place to start if you're a "first time" ranch buyer, but you'll need to fill out a detailed application, and you'll have to have been rejected by three other lenders to qualify.
 

TexasBred

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TheBullLady":347vjre9 said:
I'm a Realtor.. and if you're planning on working with an agent when you're ready to purchase, any agent worth their salt will make sure you are pre approvedbefore they show you anything. That way you're not wasting your time, or the agent / seller's time.

FSA is a good place to start if you're a "first time" ranch buyer, but you'll need to fill out a detailed application, and you'll have to have been rejected by three other lenders to qualify.


Pre-approve or pre-qualify? And how to you do either since you're not the lender??
 

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