Land buying question

[deezler]

I'm paying 6.5% on 10 acres for 10 years. I asked a few years ago if their rates had dropped any on land loans and the answer was no. The only option they offered me was depositing the outstanding balance into an account to drop the interest rate.

Edit; This was the only bank in the area that offered to loan me the money for the land. They keep all their loans in-house.
Kevin

Ouch. Did you shop around for farm credit bureaus? In MI and WI we have a company called Greenstone Farm Credit, they seem to be the only game in town for vacant land and farm land loans. I couldn't even find a local or national bank willing to loan for my 19 acres in early 2012. But Greenstone kicks *****, they return a dividend to all members annually, and offered me 5.3% on a 30 year loan.

 

[NoTrespassing]

Never checked the farm credit bureau. Only 2 years left on the loan now so I'll pay it off soon.

Kevin

 

[wmonroe]

Wmonroe, I hope ye can get ye land. I've always wanted to buy about 50-100 acres, but a bit short of lucres. So, I was only able to get 4 acres. But, I sure like being on more than a suburban lot! Keeps me busy too clearing brush, firewood, and my favorite thing - just piddling.

Thanks, I too like having some open space around me which is the main reason I want to buy it, no one will be able to build close to me unless I sell them some land. Also like you said it would give more space to piddle around on.

 

[Gunny]

Thanks, I too like having some open space around me which is the main reason I want to buy it, no one will be able to build close to me unless I sell them some land. Also like you said it would give more space to piddle around on.

Yep, piddling space is as valuable as all get out and owning your own is even better! Good luck.

 

[Cat_Driver]

That sounds very intriguing. I'm not familiar with small business loans so this might be a dumb question, but since I don't have a business would I even qualify?

I'm sure you can start a business that you need land for ....like a "nursery", "lawn maintenance" etc. Get creative, but a business license, get some cards made - BAM, your in business. Now your tractor is a write off along with you fuel, garage that you will build etc.

Obviously you don't want to anything illegal or perpetrate a fraud, but you can use the system to your advantage. I can honestly say, the Goverment made my business what it is today, and they have made a LOT of money from me. Pretty much the way Government should work Help develop business that employ people and pay taxes

 

[MossRoad]

Your business has to make a profit eventually. And some businesses require dedicated office space, customer parking, definitely good book keeping, etc.... be wary of this scam if you are just doing it to get land. I say scam, because the government will be wise to you fairly quickly.

 

[wmonroe]

I'm sure you can start a business that you need land for ....like a "nursery", "lawn maintenance" etc. Get creative, but a business license, get some cards made - BAM, your in business. Now your tractor is a write off along with you fuel, garage that you will build etc. Obviously you don't want to anything illegal or perpetrate a fraud, but you can use the system to your advantage. I can honestly say, the Goverment made my business what it is today, and they have made a LOT of money from me. Pretty much the way Government should work Help develop business that employ people and pay taxes

Unfortunately there is no time in my current work schedule for a side business, though when I get to retirement age I have been thinking about how I can use the land for a little extra income and maybe fun at the same time. The current plan for this property would be for my neighbor to farm it, he also currently farms about 14 of my 17 acres.

I guess that leads me to another question, what are people charging for someone to farm their place? He does all the work and also takes all the crops, I'm currently not charging anything for my 14 acres he is farming, but if that number jumps to 70 acres I'll probably charge something. I want to be fair but want an idea of what the "going rate is", most likely will only charge him for 1/2 to maybe 2/3 of the acreage because he is a good neighbor and would help me any time I called.

 

[smstonypoint]

I guess that leads me to another question, what are people charging for someone to farm their place? He does all the work and also takes all the crops, I'm currently not charging anything for my 14 acres he is farming, but if that number jumps to 70 acres I'll probably charge something. I want to be fair but want an idea of what the "going rate is", most likely will only charge him for 1/2 to maybe 2/3 of the acreage because he is a good neighbor and would help me any time I called.

You can find average county-level cash rents here: USDA/NASS QuickStats Ad-hoc Query Tool.

Keep in mind that there is considerable variation in cash rents within counties.

Steve

 

[wmonroe]

Thanks for the link. I'm only getting one result so I'm probably doing something wrong but I'll keep messing with it. Looks like it can provide a lot of data once I figure it out.

 

[smstonypoint]

Thanks for the link. I'm only getting one result so I'm probably doing something wrong but I'll keep messing with it. Looks like it can provide a lot of data once I figure it out.

In which county is the property located?

Steve