banks + lending rates

[Mf240]

so are you looking to borrow money to buy land to then inturn rent it. Suppose once you own it, it just makes you a fortune

Its a good investment if you are able to pay for it through off farm income.

The rent will contribute towards repayments and youll have an asset eventually.

 

[bull_market]

And more importantly, the loan to value ratio and indeed the level of security.

Look a tad high to me, hence the question.

cost of farm is 650 k , 79 acres

 

[tinman]

cost of farm is 650 k , 79 acres

if that farm is 650k and all you need to borrow is 125k, then if i was you id buy it.

 

[bull_market]

if that farm is 650k and all you need to borrow is 125k, then if i was you id buy it.

i have bought it , well put down a deposit

 

[tinman]

i have bought it , well put down a deposit

well fair play.
best of luck with it.

 

[guest]

And now what we are all wondering is where did you get the rest of the money , did you sell other land or win the lotto ,

 

[JOHNNY BOY]

i have bought it , well put down a deposit

good man hope all goes to plan, when putting down that amount yourself should have some bargaining power with the bank on interest rate i would tthink. every little helps

 

[bull_market]

good man hope all goes to plan, when putting down that amount yourself should have some bargaining power with the bank on interest rate i would tthink. every little helps

BOI were very rigid but then again the bank manager is a woman at my local branch

 

[tinman]

BOI were very rigid but then again the bank manager is a woman at my local branch

that shouldnt have anything to do with it shurley .

 

[bull_market]

that shouldnt have anything to do with it shurley .

women in business ( banking etc ) tend to be more by the book and reluctant to stray from strict guidelines

 

[nashmach]

cost of farm is 650 k , 79 acres

Well fair play and congrats on your purchase.

That gives you plenty of leeway to be honest and I'd be squeezing them a little more.

I'd also try at least one more bank and possibly play one off the other.

I wouldn't blame your local manager, for many loans now these have to go to regional heads or HQ.

 

[Ozzy Scott]

women in business ( banking etc ) tend to be more by the book and reluctant to stray from strict guidelines

I dont agree, I have a super female business manager who is a pleasure to deal with, have dealt with male managers in the past and didnt find they had little or no interest in understanding your business. I deal with a good few ladies in general and find them all top notch

BTW best of luck with the land

 

[Limestone Cowboy]

Anyone talking to the banks lately? What kind of interest rates are available at the moment?

 

[Ozzy Scott]

Anyone talking to the banks lately? What kind of interest rates are available at the moment?

rates for what? machinery, short term secured/unsecured, land ?????

 

[Limestone Cowboy]

rates for what? machinery, short term secured/unsecured, land ?????

Land, secured. Around 100k over 15 years.

 

[Cork]

Land, secured. Around 100k over 15 years.

In 2016 it was around 5%. I could be wrong but I thought I heard 3.5% earlier this year? Nothing written down but 3.5 is in my head so subject to correction.

 

[whelan1]

3.9 is what I'm on.

 

[JPGR]

What kind of deposit are the banks talking about for a commercial loan to buy agri land at the moment? Circa 40% I would imagine?

 

[Ozzy Scott]

Land, secured. Around 100k over 15 years.

go unsecured, it will cost an extra 2%, but over 15yrs it will be about €20k. low value to put on the price of holding onto your land, if things went tits up, which is possible given current ag

 

[Barrowsider]

go unsecured, it will cost an extra 2%, but over 15yrs it will be about €20k. low value to put on the price of holding onto your land, if things went tits up, which is possible given current ag

I wouldn't agree. €20k is 20% of the principal, a large proportion. I wouldn't be willing to give any bank that sort of easy money. Just because the loan is unsecured doesn't mean you can walk away if things went tits up, the bank will fight to get their money back either way.

 

[Barrowsider]

In 2016 it was around 5%. I could be wrong but I thought I heard 3.5% earlier this year? Nothing written down but 3.5 is in my head so subject to correction.

I would think the borrowings would have to be greater than €100k to get a rate of 3.5%. It all depends how badly the bank wants the business though.

 

[jay gatsby]

go unsecured, it will cost an extra 2%, but over 15yrs it will be about €20k. low value to put on the price of holding onto your land, if things went tits up, which is possible given current ag

Highly unlikely the bank will give 100k unsecured. It might say they will in the literature but i think it's easier said than done

 

[denis086]

Under 125k they don’t require security, but I’ve also heard that that means nothing now if it comes to the worst, you’re still required to give a personal guarantee so the land is still at risk should it come to it.

 

[Limestone Cowboy]

What kind of deposit would be required on a secured loan?

 

[Barrowsider]

What kind of deposit would be required on a secured loan?

It depends on the bank but its often around 25% of the value of the property