Banks and Financing

[vtr996]

Of course we all know that the tractor manufacturers offer financing on their products. However there are some attractive "cash" deals to be had on new and used equipment. Regarding getting bank financing, I've checked with my local credit union and a local bank. One does not offer equipment loans but would provide a 'signature' loan at around 13%! The other does offer equipment loans, 20% down, 6% interest, max of 3 year term. Neither of these are attractive to me. Have you guys had any luck with financial institutions for tractor loans that are decent, say 6% interest, 5 years?

 

[AndyMA]

I suspect the rates you have been quoted are pretty good for what you are looking for. Remember the manufactures typically "buy down" interest rates. Have you considered a home equity loan?

Andy

 

[tornadowatchranch]

Talk to your local farm credit agency. My guy has 6%/48 and 6.5%/60. They want 20% down but I talked to them about the free loader deal and the massive rebates on bobcat and they valued in such a way so there will little to no down. Regular banks do not understand how the ag world works. I am set up as a farm with a USDA number. I don't know if that matters or not. Good luck.

 

[MikeD74T]

I took out a $50k home equity line of credit 10 years ago to buy a piece of property. Have also used it infrequently for various purchases as an interest offset. i.e. Buy something for 1 year interest free then pay it off at one year anniversary from the line of credit. Interest rate last month on the line of credit was 1.7%. Highest over the 10 years was 7%, at which time I put the balance on a 1 year interest free credit card. There's low interest credit available, you just have to be able to pay at the deadline. I typically pay 4-5x the minimum each month. MikeD74T

 

[vtr996]

Thanks for the replys! Per TornadoRanch I found a farm credit locally. They offer tractor loans, 1yr to 7yr terms, 5%-7%. They require 25% down. I'm gonna keep saving my money and keep shopping!!

 

[chh]

If there is an independent bank in a community with a lot of farms in the area close to you check with them. My bank does tractor loans on a regular basis. The interest rate will be higher than from the dealer, but a lot of times the cash price is good enough to offset that.
Just buying with cash is better yet. IMO

 

[JoelD]

Thanks for the replys! Per TornadoRanch I found a farm credit locally. They offer tractor loans, 1yr to 7yr terms, 5%-7%. They require 25% down. I'm gonna keep saving my money and keep shopping!!

If you've got the time and the means, you've found the best answer, save and pay with cash.

With all that's been going on, I've been agressively paying down debt (mortgage is the only debt we've got). I figure a guaranteed reduction in interest on mortgage of 4.875% (fixed rate on my note) is a bunch better than most any other return I can get.

One of the reasons I bought my TLB used was so I could pay cash.

My old dad taught me to avoid debt at all costs.

Also typically puts you in a powerful negotiating position.

Good luck,
Joel

 

[newbury]

If you've got the time and the means, you've found the best answer, save and pay with cash.

<snip>,
Joel

I used to be a tightwad like that, found it may not pay.
Currently I'm borrowing money for two cars on loans of about 3.5% from the credit union, with a little more than that same amount banked at the same credit union (NFCU) at about 4%.

Now is a relatively good time to take out a loan, with your eyes wide open!! And put that money to good NOT FRIVOLOUS use, whether it be buying that extra piece of land or that implement that dramatically increases your work output.
Borrow low, invest high..

 

[warhammer]

Agricredit Acceptance does 5 year loans.
Or
If you have a farm apply at the local land bank.

Warhammer

Of course we all know that the tractor manufacturers offer financing on their products. However there are some attractive "cash" deals to be had on new and used equipment. Regarding getting bank financing, I've checked with my local credit union and a local bank. One does not offer equipment loans but would provide a 'signature' loan at around 13%! The other does offer equipment loans, 20% down, 6% interest, max of 3 year term. Neither of these are attractive to me. Have you guys had any luck with financial institutions for tractor loans that are decent, say 6% interest, 5 years?

 

[vtfx4]

Many credit unions will finance a NEW tractor just like a car. I got 5.74 for 5 years. A used tractor brings the rate up quite a bit.

I agree with what others have said. Now is a good time to buy things as inventories are up. If you have a stable job then wise purchases on credit could save money over the long haul. Same goes for construction and renovation. Alot of contractors are low on work and will work for less. You may interest on a loan to get the work done, but when the economy picks up you may pay 30 percent more for the same job.