Interest rates when buying land?

corkfarmer2

Looking to get idea of current interest rates on land loans. Five years ago bought twelve acres through AIB at 5.5%. Another field has come up and I'm being quoted 4.95% now, with the same bank. Think that the 5.5% is a bit high, and have now asked them to lower this to match the current rate of 4.9%. They are very slow to do this. Would it be worthwhile looking elsewhere? Any idea of rates out there at the moment?

Brandnew404

corkfarmer2 wrote: »

Looking to get idea of current interest rates on land loans. Five years ago bought twelve acres through AIB at 5.5%. Another field has come up and I'm being quoted 4.95% now, with the same bank. Think that the 5.5% is a bit high, and have now asked them to lower this to match the current rate of 4.9%. They are very slow to do this. Would it be worthwhile looking elsewhere? Any idea of rates out there at the moment?

4.95% is an exceptionally good interest rate to the best of my knowledge, somewhere around 6% or slightly lower is the going rate on house mortgages at the moment… you surely heard of the new loans being made available to farmers where we can borrow upto €150,000 at only 2.95% interest? It's a government backed initiative

Mooooo

BOI were at 4.5 two years ago. Mortgage interest rates are lower than 6% around 3.5 I think, being advertised. It's their margin pushing it up. If you have a good history check with other banks and push for a better rate

tom_k

Brandnew404 wrote: »

4.95% is an exceptionally good interest rate to the best of my knowledge, somewhere around 6% or slightly lower is the going rate on house mortgages at the moment… you surely heard of the new loans being made available to farmers where we can borrow upto €150,000 at only 2.95% interest? It's a government backed initiative

If you're referring to SCBI loans, the product offered via AIB at least has a variable rate of 4.5%. However these type of loans are not available for land purchase.

http://business.aib.ie/products/finance-and-loans/sbci-loan/sbci-loan-what-else-do-you-need-to-know#Agri-sector

Brandnew404

Mooooo wrote: »

BOI were at 4.5 two years ago. Mortgage interest rates are lower than 6% around 3.5 I think, being advertised. It's their margin pushing it up. If you have a good history check with other banks and push for a better rate

It would be fixed at 4.5% for the first couple years only and then you'd be paying a variable and almost certainly higher rate for the remainder of the loan

Mooooo

Brandnew404 wrote: »

It would be fixed at 4.5% for the first couple years only and then you'd be paying a variable and almost certainly higher rate for the remainder of the loan

4.5 variable is what I got (edit not a house mortgage, was land purchase)

20silkcut

Brandnew404 wrote: »

4.95% is an exceptionally good interest rate to the best of my knowledge, somewhere around 6% or slightly lower is the going rate on house mortgages at the moment… you surely heard of the new loans being made available to farmers where we can borrow upto €150,000 at only 2.95% interest? It's a government backed initiative

Are those loans specifically to clear merchant credit?? Could you get one of those loans if you didn't have a merchant credit debt? It says specifically that the loans are not given out for land,machinery or stock purchasing. Surely that's the reason most farmers take out loans.

Brandnew404

20silkcut wrote: »

Are those loans specifically to clear merchant credit?? Could you get one of those loans if you didn't have a merchant credit debt? It says specifically that the loans are not given out for land,machinery or stock purchasing. Surely that's the reason most farmers take out loans.

There was an article on Agriland what you could use the loans for, once you get the money off them anyway you can do whatever you want with it anyway

Bass Reeves

Mortgage interest rates at present are about 4% fixed for three years. Usually commercial mortgages are about 1% above that. Just looking at them rates I am glad I did a tracker commercial loan all them years ago. Capita that are managing the ACC loan book wrote to me the other day rate reduced from 1.83% to 1.67%. Highest rate on the loan over the term was about 6% . I reckon. Over the term of the loan I will have averaged around 3-3.5%. Who is a happy little bear

Brandnew404

Bass Reeves wrote: »

Mortgage interest rates at present are about 4% fixed for three years. Usually commercial mortgages are about 1% above that. Just looking at them rates I am glad I did a tracker commercial loan all them years ago. Capita that are managing the ACC loan book wrote to me the other day rate reduced from 1.83% to 1.67%. Highest rate on the loan over the term was about 6% . I reckon. Over the term of the loan I will have averaged around 3-3.5%. Who is a happy little bear

Jesus I don't know about all that… what's a commercial mortgage and how is it different to a normal one?

Bass Reeves

Brandnew404 wrote: »

Jesus I don't know about all that… what's a commercial mortgage and how is it different to a normal one?

Land loans are commercial mortgages and business loan secured on commercial property is a commercial mortgages however big difference in both between now and the noughties. Tracker loans were quite common on both house loans and mortgages. I was one of the lucky one when I borrowed in mid noughties I got a tracker that was 1.5% above interbank rate. Tell you how low the banks are borrowing from each other at present it is less that 0.2% I am paying 1.5 above that