News - Farm Mortgage Loan

Achieving Successful Farm Financing, Part 2

June 3, 2018/in Uncategorized /by Chris Siebeneck

Last time in this space, we went over some of the first steps that go into achieving a successful agricultural finance situation. Farm credit loans may seem complex, and they do have a few important steps, but in the end this process is pretty straightforward.

And at Farm Mortgage Loan, we’re here to help with every step. With that in mind, let’s finish up our list of the stages of the farm loans process and acquiring land.

Get In Touch With Sellers

Once you’ve found a suitable property, it’s time to contact its seller. You’ll want to have a wide range of questions ready for this person, including basics on utilities, water sources, structures, previous AG production, zoning restrictions, any liens, access roads or property considerations, and any issues they’ve had with the property in the past. Ask why the sellers are selling the property as well, as this can often provide a glimpse into any problems you should be aware of.

Inspect Property

With an experienced pro if possible, you should always walk the property yourself before purchasing with permission from the seller. Take photos wherever possible, and make sure to note things like land boundaries and water sources.

Meet the Neighbors

Neighboring land owners are a great resource, not only because you might interact with them in the future, but also because they can help advise you on the quality of the land you might purchase. Ask them about basic history or any other questions that might help with your research. Neighbors often help you pick up important red flags.

Research and Making an Offer

If you don’t see any major issues, the last step is doing some final research before making an offer. Check out previous appraisal values for the area or that specific property, and look into the area’s history and other factors. Check into important factors like the cost of running utilities into the property.

Rom here, take a smart approach to your offer. Most farm properties sell for about 85 percent of their initial asking value – you can offer lower than this, but don’t be insulting and turn the seller off. Make sure you leave room for ab it of negotiation on both sides.

Contract Review

Once you and the seller have agreed on a price, make sure you have the contract reviewed by an independent third party. You and the seller should split the cost here.

Closing

Finally, it’s time to close. You should have all your financing in place, and you’ll meet with the title company to sign the proper documents and get things closed out.

For more on the process of acquiring AG financing and land, or to learn about any of our farm loans, speak to the pros at Farm Mortgage Loan today.

Achieving Successful Farm Financing, Part 1

May 3, 2018/in Uncategorized /by Chris Siebeneck

At Farm Mortgage Loan, we’re dedicated to you, the customer. Our professionals have years of experience helping procure agricultural finance for farms, with the ability to connect you to the best lenders and farm loans available.

With the right steps taken within your financing process, you’ll be setting your farm up for a secure future. In part one of our two-part blog series, here are several tips for a successful farm financing situation.

Advanced Planning

First and most importantly, plan ahead as thoroughly as you can. You must have a plan in mind for how you’ll use your financing, as this decision can affect the type of lender and the loan product you need. Some possible areas you might be requiring financing for include:

Farming, livestock or other agricultural use
Development
Building a home
Equipment
Long- or short-term investment, or diversifying investment portfolio

Research

If you’re just starting or growing a business, consider your business type – the crops you’ll grow, the climate and location you’ll need, and the costs and time it’ll take to grow the crops you have in mind.

Business Planning

In the early stages of your process, create a business plan or concept to assess the financial impact of your business. Assess the local business climate, and use sample business plans if needed. This can also help you qualify for loans in many cases.

Marketing Planning

A good marketing plan is vital for any farm business. You need to include your products, their pricing, how they’ll be sold, and ideas for advertising them.

Securing Financing

From here, your next step is getting pre-approved for financing. Waiting too long here could put you in a rough spot, as federal farming loan cycles can take a while in some cases. Make sure you’re on top of this in advance.

Down Payment Savings

This is a step you should be taking well in advance – saving for a down payment is vital. Different lenders have different requirements here, but we can give you a basic list ahead of time so you have a good idea.

Searching For Land

From here, you’re ready to begin your actual property search. There are numerous resources available to you here, first and foremost our farm loan professionals. Call us at Farm Mortgage Loan today to learn more.

Where AG Loans Can Help Your Business

April 3, 2018/in Uncategorized /by Chris Siebeneck

At Farm Mortgage Loan, we’re proud to provide the best AG and farm loans out there for those in need. These loans are useful to numerous entities within the agricultural business, from smaller startups to even the biggest businesses out there.

There are several possible uses for AG loans, depending on the needs of your business. Let’s look at a few considerations and possibilities for how to use this money.

Buy or Rent?

One of the primary uses of these types of loans is for farm equipment, and one of your first big questions here will be whether to buy or rent. Many pieces of farming equipment come with a hefty price tag, even for those working with loan financing. For newer businesses or those low on cash flow, renting for a time might be the appropriate route – when you’ve built up your finances a bit, you can then consider buying a few of the bigger and more common items that you use.

Land Considerations

The land is another common use of these loans, and there are a few important considerations here. For starters, you have to know which kinds of crops you want to harvest, and you need a plan for how much land you’ll need to hit the numbers you’re looking for. In addition, you have to ensure that your planned harvest will be enough to cover the loan amount, with a little wiggle room if possible in case of overhead.

Promotion

While many don’t consider it as often, money from farm loans can also be used for promoting your products. There are many ways you can go about this, including brand logos, online promotions, focused ad campaigns and more. Hiring consultants for this purpose is another potentially great use of these kinds of funds.

Growing the Business

And finally, these loans are great for helping grow the business. Starting a farming business comes with some major expenses, and expanding does much of the same. The industry can fluctuate based on crops and other factors, and you don’t have the luxury of guessing – you need the proper financing to grow to the size you desire.

To learn more about how our farm equipment loans can help, speak to the pros at Farm Mortgage Loan today.

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