Agricltural Loan for Land Purchase

ihatewinter

Hey a bit of land has come up near me for sale. I want to purchase it. Have a few questions as no experience of farm loans

Can I use my own bank (BOI) or can I go with another bank that specialises in farm loans.

What percentage do I need for a deposit, I own land so can use it as an asset

As a young farmer who will get entitlements from the national reserve, can I use this as an asset, same as Young Farmers Scheme where i will get 3 years on it.

Will they take DAS/National Area of Constraint as an asset same with the new GLAS scheme as I will have first preference in.

I have about 11,000-13,000 in savings and will be able to get a guarantor.

Land is worth about 160,000 with a livable dwelling on it.

Thanks

Milked out

ihatewinter wrote: »

Hey a bit of land has come up near me for sale. I want to purchase it. Have a few questions as no experience of farm loans

Can I use my own bank (BOI) or can I go with another bank that specialises in farm loans.

What percentage do I need for a deposit, I own land so can use it as an asset

As a young farmer who will get entitlements from the national reserve, can I use this as an asset, same as Young Farmers Scheme where i will get 3 years on it.

Will they take DAS/National Area of Constraint as an asset same with the new GLAS scheme as I will have first preference in.

I have about 11,000-13,000 in savings and will be able to get a guarantor.

Land is worth about 160,000 with a livable dwelling on it.

Thanks

The banks primary concern will be your repayment capacity, after that you may get a 90% loan If you have enough security and a sound plan in place . Go to whatever bank you want, try a couple with your proposal, competition will help u some bit anyway. Get all your info together first

Timmaay

Milked out wrote: »

The banks primary concern will be your repayment capacity, after that you may get a 90% loan If you have enough security and a sound plan in place . Go to whatever bank you want, try a couple with your proposal, competition will help u some bit anyway. Get all your info together first

I don't think any bank will give a commercial mortgage over 75%?

Question for the OP, what are your repayment plans, will the farm itself pay back the mortgage or are you paying it from off farm income?

ihatewinter

Repayments will come from farm and off- farm income. I have land security to about 200,000 euro. The thing is I don't have 25% assets/savings for a 75% but have for a 90% loan.

I live at home so I have no rent/mortgage at the moment. I know the banks won't care about that but I have no major outgoings or loans/bad credit history.

Cran

ihatewinter wrote: »

Repayments will come from farm and off- farm income. I have land security to about 200,000 euro. The thing is I don't have 25% assets/savings for a 75% but have for a 90% loan.

I live at home so I have no rent/mortgage at the moment. I know the banks won't care about that but I have no major outgoings or loans/bad credit history.

If you have the assets, repayment ability and credit rating they wouldn't worry about mortgage %. Remember you need to cover all costs though which can add up

Miname

The banks are more approachable these days. Get a business plan with realistic figures done up and go from there. The fact the house is on it may be beneficial as an extra form of income as in rent or maybe approach it as a mortgage rather than an agri loan. Repayment capacity and plan is going to be your most important feature so get going on that. Make sure you really want it too. In saying that you only get one bite at the cherry

ihatewinter

Thanks Mimane, it do really want it, as I will expand and have an house

keep going

banks like 30% security and it can either be as cash or orther land but in my opinion you should only use the asset your buying to secure a loan.they like garunteed sfp not applications to national reserve and any annual income is looked on favourably.try every bank,you can put together a package that will usually do them all

B25

Try and get your borrowings over a longer period so that you are very comfortable with your pay back capabilities. You can always pay it back sooner. Make out of course lodgements etc., The faster you pay it back the less interest you will have to pay overall but you don't want it to be a huge drag on you especially at the beginning when you may have some unexpected expenses.