Lending question

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ddd75
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Re: Lending question

Postby ddd75 » Tue May 02, 2017 6:27 am

DLD wrote:
ddd75 wrote:
DLD wrote:If you can go with a Farm Credit institution, I think you'd like it. They will probably require 30-35% down (FSA guarantees are an option if you're in a tighter financial situation), but you'll be dealing with a lender that is strictly agricultural - they understand what's going on, and want to help you be successful. Depending on which county you're in, there are 2-3 different associations serving sw OK. It's at least worth checking into.



i've had so many people try to buy my places with banks like 'farm credit' etc.. they are VERY difficult to get loans through.

A local bank is much easier to deal with. bar none


I've purchased 3 farms and I've gotten all 3 with 0 down just other property as collateral.


Every Farm Credit association will be different to deal with, just like every commercial bank. That's like saying never drive a Chevy because you don't like your local dealership. Yes, you're going to need pretty good financials to deal with a Farm Credit, but in return you're getting better rates and better terms than most commercial banks will offer, not to mention I know of no commercial banks that pay patronage, but most Farm Credits do.

Around here, most of the mid sized banks are being bought up by big banks who have little to no interest in ag lending. I agree that small local banks are usually the easiest to deal with, my local banker has never told me no, but he doesn't negotiate on interest or terms. You take it or leave it. I do all my short term stuff with him because it is easy, but Farm Credit has always been a far better deal for us for anything longer than a year or so.

There are some local and regional banks in some places that are competitive ag lenders, I'm certainly not saying not to give them a chance if you have one or more of those nearby, but I know something about the situation here in SW OK. I still stand by my statement that Farm Credit is worth looking into as well.


I'm not saying not to look into them.. they might have the best deal .. *IF* you qualify for them. I've seen A LOT of people turned down by that agency that any other bank would give a loan too.

The big problem is they tell people.. "oh, we have this program that will fit you PERFECT!!"

Then they take 40-60 days+ to give you a decision.. the entire time saying "it looks good". The problem with that is then they come out and say.. well its not going to work.. your done. you lost the farm, another buyer has it, etc.

My 2nd farm I tried to use them as I was buying a place out of state and moving there. Oh yea.. no problem, we can do that.. 30 days into it they just point blank told my wife.. "we don't believe you own what you do, how did you get all this at such a young age, its impossible" She said.. we have all the proof, titles, etc.. we've worked really hard" FC: " so.... how did you do it though?" wife: "are you going to do the loan?" FC: "no"

not because I wasn't qualified.. not because I didn't have a down payment.. because they didn't want to believe what I owned.. WHAT?!??!!?!??!?!?!?!?! crazy.

That 1/2 interest point won't do you any good if you don't get what your trying to buy.

From what I've seen, only people with MORE then enough money have a chance at getting a loan through FC. OR.. I HAVE seen them get the loan but daddy has put his name on it as well, and has the money.

This isn't a 1 time thing, i've seen this with at least 2 dozen people in 3 states using different FC offices get turned down. It wasn't because they weren't qualified either. I even had my last realtor tell me he knows the lady who runs this FC office and she'll get the loan through.. NO PROBLEM! well.. I told him it wasn't going to work..etc.. He wouldn't budge and sure enough, she said her hands were tied.. couldn't do it.. just like I told him from day 1.

IF you're going to use them I HIGHLY suggest you also go with a local bank at the same time... so you don't lose your chances at what your trying to buy..


You might think FC will give you the best rates.. but i've done better everytime with a local bank. My most recent farm loan was at 4.5% @ 30 year loan with 0 down out of pocket. You'll never see that deal with FC.

also on this same farm I bought, the guy had a loan with FC that needed paid for title could transfer. They would NOT take the money. We were on hold for over 2 weeks and the bank had to use their attorney to get them to take the money!

I know a lot of people on here have used them and it worked out great, but what I'm saying is don't put all your marbles in one basket.. always.. always have a backup IF you really want what your trying to buy.

just my experiences :)
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Re: Lending question

Postby True Grit Farms » Tue May 02, 2017 7:10 am

I had the same problems with Farm Credit myself. I'm a "creative financier" in their eyes.
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Re: Lending question

Postby Cross-7 » Tue May 02, 2017 7:32 am

I've used farm credit several times in Texas and Oklahoma over the years and never had a problem, except one time their appraisal was 50.00 an acre less that the price I was buying it for.
I still think they were wrong.
I may not be good at many things but I've been pretty good at buying under valued property and this one was at least a 100 an acre under.
There hasn't been anything in the area that has sold for what they appraised it for.
Even one place that wasn't as good and sold at auction brought more than the appraisal.

They are my first choice when financing
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Re: Lending question

Postby TexasBred » Tue May 02, 2017 10:53 am

ddd75 wrote:I'm not saying not to look into them.. they might have the best deal .. *IF* you qualify for them. I've seen A LOT of people turned down by that agency that any other bank would give a loan too.

The big problem is they tell people.. "oh, we have this program that will fit you PERFECT!!"

Then they take 40-60 days+ to give you a decision.. the entire time saying "it looks good". The problem with that is then they come out and say.. well its not going to work.. your done. you lost the farm, another buyer has it, etc.

My 2nd farm I tried to use them as I was buying a place out of state and moving there. Oh yea.. no problem, we can do that.. 30 days into it they just point blank told my wife.. "we don't believe you own what you do, how did you get all this at such a young age, its impossible" She said.. we have all the proof, titles, etc.. we've worked really hard" FC: " so.... how did you do it though?" wife: "are you going to do the loan?" FC: "no"

not because I wasn't qualified.. not because I didn't have a down payment.. because they didn't want to believe what I owned.. WHAT?!??!!?!??!?!?!?!?! crazy.

That 1/2 interest point won't do you any good if you don't get what your trying to buy.

From what I've seen, only people with MORE then enough money have a chance at getting a loan through FC. OR.. I HAVE seen them get the loan but daddy has put his name on it as well, and has the money.

This isn't a 1 time thing, i've seen this with at least 2 dozen people in 3 states using different FC offices get turned down. It wasn't because they weren't qualified either. I even had my last realtor tell me he knows the lady who runs this FC office and she'll get the loan through.. NO PROBLEM! well.. I told him it wasn't going to work..etc.. He wouldn't budge and sure enough, she said her hands were tied.. couldn't do it.. just like I told him from day 1.

IF you're going to use them I HIGHLY suggest you also go with a local bank at the same time... so you don't lose your chances at what your trying to buy..


You might think FC will give you the best rates.. but i've done better everytime with a local bank. My most recent farm loan was at 4.5% @ 30 year loan with 0 down out of pocket. You'll never see that deal with FC.

also on this same farm I bought, the guy had a loan with FC that needed paid for title could transfer. They would NOT take the money. We were on hold for over 2 weeks and the bank had to use their attorney to get them to take the money!

I know a lot of people on here have used them and it worked out great, but what I'm saying is don't put all your marbles in one basket.. always.. always have a backup IF you really want what your trying to buy.

just my experiences :)

DDD lenders can't turn down potential borrowers "just for the he// of it". They have to have a verifiable reason and state that reason in the letter of denial. (That's a federal regulation). I don't know any that will make a 100% loan either. Now you may get a loan for "nothing out of your pocket" but I believe you said you put up another property as additional collateral so you did in fact pledge something of considerable value as collateral. I've never known a bank to turn down money except in the case where a loan was in foreclosure, the final demand letter had been sent and the property was posted for sale, after which they will refuse to take anything short of the total delinquency at best or total payoff of the debt at the worst.
The best backup plan to approach any lender with a situation that is workable for everyone involved as far as down payments, verifiable income and debts, ability to repay and a credit score well above average and nobody has to make any exceptions to their general policies. The deal will sail through as smooth as silk every time.
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Re: Lending question

Postby Cross-7 » Tue May 02, 2017 6:07 pm

Just to add one more thing about farm credit.
Everyone I've ever dealt with there has been top notch and super to deal with.
There is another called Ag (state I'm from)
That was pure misery.
To make a long story short they said we can't give you a loan because of your cc debt.
I responded I don't have any cc debt.
They said your wife does.
I jumped her a$$
Wrong thing to do !!!! ( FYI check facts 1st)
It was like 2500
I called and explained that was month to month expenses raising a family and we try to get as many points as we can so we use it for everything and was paid off every month
End result no loan.
Farm credit came through and matched the internet rate the other was offering
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Re: Lending question

Postby ddd75 » Wed May 03, 2017 6:29 am

TexasBred wrote:
ddd75 wrote:I'm not saying not to look into them.. they might have the best deal .. *IF* you qualify for them. I've seen A LOT of people turned down by that agency that any other bank would give a loan too.

The big problem is they tell people.. "oh, we have this program that will fit you PERFECT!!"

Then they take 40-60 days+ to give you a decision.. the entire time saying "it looks good". The problem with that is then they come out and say.. well its not going to work.. your done. you lost the farm, another buyer has it, etc.

My 2nd farm I tried to use them as I was buying a place out of state and moving there. Oh yea.. no problem, we can do that.. 30 days into it they just point blank told my wife.. "we don't believe you own what you do, how did you get all this at such a young age, its impossible" She said.. we have all the proof, titles, etc.. we've worked really hard" FC: " so.... how did you do it though?" wife: "are you going to do the loan?" FC: "no"

not because I wasn't qualified.. not because I didn't have a down payment.. because they didn't want to believe what I owned.. WHAT?!??!!?!??!?!?!?!?! crazy.

That 1/2 interest point won't do you any good if you don't get what your trying to buy.

From what I've seen, only people with MORE then enough money have a chance at getting a loan through FC. OR.. I HAVE seen them get the loan but daddy has put his name on it as well, and has the money.

This isn't a 1 time thing, i've seen this with at least 2 dozen people in 3 states using different FC offices get turned down. It wasn't because they weren't qualified either. I even had my last realtor tell me he knows the lady who runs this FC office and she'll get the loan through.. NO PROBLEM! well.. I told him it wasn't going to work..etc.. He wouldn't budge and sure enough, she said her hands were tied.. couldn't do it.. just like I told him from day 1.

IF you're going to use them I HIGHLY suggest you also go with a local bank at the same time... so you don't lose your chances at what your trying to buy..


You might think FC will give you the best rates.. but i've done better everytime with a local bank. My most recent farm loan was at 4.5% @ 30 year loan with 0 down out of pocket. You'll never see that deal with FC.

also on this same farm I bought, the guy had a loan with FC that needed paid for title could transfer. They would NOT take the money. We were on hold for over 2 weeks and the bank had to use their attorney to get them to take the money!

I know a lot of people on here have used them and it worked out great, but what I'm saying is don't put all your marbles in one basket.. always.. always have a backup IF you really want what your trying to buy.

just my experiences :)

DDD lenders can't turn down potential borrowers "just for the he// of it". They have to have a verifiable reason and state that reason in the letter of denial. (That's a federal regulation). I don't know any that will make a 100% loan either. Now you may get a loan for "nothing out of your pocket" but I believe you said you put up another property as additional collateral so you did in fact pledge something of considerable value as collateral. I've never known a bank to turn down money except in the case where a loan was in foreclosure, the final demand letter had been sent and the property was posted for sale, after which they will refuse to take anything short of the total delinquency at best or total payoff of the debt at the worst.
The best backup plan to approach any lender with a situation that is workable for everyone involved as far as down payments, verifiable income and debts, ability to repay and a credit score well above average and nobody has to make any exceptions to their general policies. The deal will sail through as smooth as silk every time.



looks like i'll be goign with farm credit next time!
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Re: Lending question

Postby hurleyjd » Wed May 03, 2017 8:59 am

You are also a owner with the Farm Credit banks. I have a 4.5 loan. After profit sharing the rate was 3.25. We closed within two weeks holdup was the independent appraiser. I have a friend that manages a Credit Union. he states if you can pay it back he will loan it if you cannot then go somewhere else. He also said that he has to have 20% tied up in a real estate loan. Vehicles is another story with him. Also I had to come up with $40000 plus to make the Farm Credit deal work.
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Re: Lending question

Postby TexasBred » Wed May 03, 2017 4:05 pm

hurleyjd wrote:You are also a owner with the Farm Credit banks. I have a 4.5 loan. After profit sharing the rate was 3.25. We closed within two weeks holdup was the independent appraiser. I have a friend that manages a Credit Union. he states if you can pay it back he will loan it if you cannot then go somewhere else. He also said that he has to have 20% tied up in a real estate loan. Vehicles is another story with him. Also I had to come up with $40000 plus to make the Farm Credit deal work.

Real estate lenders are just like all others. They want you to have an investment in the property (down payment) giving you something to lose. Makes you a bit more unlikely to bail on them. With all the current regulations I'm really surprised they can get a loan closed in 2 weeks. That's hardly any time at all.
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Re: Lending question

Postby Brute 23 » Wed May 03, 2017 5:09 pm

It is beyond me why you would want a zero down loan if you have cash in your hand.
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Re: Lending question

Postby ddd75 » Wed May 03, 2017 5:16 pm

Brute 23 wrote:It is beyond me why you would want a zero down loan if you have cash in your hand.



no shame in admitting it.
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Re: Lending question

Postby Brute 23 » Wed May 03, 2017 5:50 pm

ddd75 wrote:
Brute 23 wrote:It is beyond me why you would want a zero down loan if you have cash in your hand.



no shame in admitting it.


Inlighten me.... but you better bring some thing better than that I can make more than they charge me in interest bs
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Re: Lending question

Postby ddd75 » Thu May 04, 2017 6:32 am

Brute 23 wrote:
ddd75 wrote:
Brute 23 wrote:It is beyond me why you would want a zero down loan if you have cash in your hand.



no shame in admitting it.


Inlighten me.... but you better bring some thing better than that I can make more than they charge me in interest bs



obviously you don't have the capacity to figure it out, so I'm not going to try. Go read a finance 101 book and that might help a little.
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Re: Lending question

Postby Stocker Steve » Thu May 04, 2017 6:42 am

Brute 23 wrote:It is beyond me why you would want a zero down loan if you have cash in your hand.


I think there are three main camps of thinking on land leverage:

1) Minimum down to maximize return in an up market. I think Trump would be all in on this.
2) Enough down so the ag production cash flows. My banker is all in on this. The most common way to make land pay here is organic dairy and most can not/will not do this.
3) Subdivide, put what you want down, and then work out to pay the mortgage. Sad...
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Re: Lending question

Postby Brute 23 » Thu May 04, 2017 6:55 am

ddd75 wrote:
Brute 23 wrote:
ddd75 wrote:

no shame in admitting it.


Inlighten me.... but you better bring some thing better than that I can make more than they charge me in interest bs



obviously you don't have the capacity to figure it out, so I'm not going to try. Go read a finance 101 book and that might help a little.


Naw... your sooo smart. Come on. Don't crawfish now.

Just what happened is what most people do. Yall try to sound smarter than yall are by repeating some thing you heard, from some one else, trying to sound smart.

That playing the interest stuff is bs when you apply real world, not book, numbers to it. Best.... absolutely best, case scenario is you have risked a whole paid for asset to make 1 or 2%... at best... if every thing goes perfect. That is re-dic-u-lous. You put up collateral at maybe $2 to $1 in order to make peanuts on that money... at best. AND, if you really are soo great at making money, it should not be any issue to put the money down since you should be flush with cash from all those profits. Real wealthy people are looking for places, like land, to squirrel away money.

The reality is most people who buy zero down do not have the available cash... and that's ok... but own that. Say I don't I have the cash to put down and fulfill my other obligations. Don't try to sound smart and act like you are playing some interest game that does not exist.

I have actually heard some legit reasons for people buying zero down but they all involved people being flat out honest with what they were trying to do... not hiding behind financial books.
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Re: Lending question

Postby TexasBred » Thu May 04, 2017 7:01 am

ddd75 wrote:
Brute 23 wrote:
ddd75 wrote:

no shame in admitting it.


Inlighten me.... but you better bring some thing better than that I can make more than they charge me in interest bs



obviously you don't have the capacity to figure it out, so I'm not going to try. Go read a finance 101 book and that might help a little.

I think we'd rather hear your ideas on it. I've lived the "book". Now tell us why "please".
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