Northern Ag Network
Northern Ag Network
Northern Broadcasting System    Northern News Network    Northern Sports Network
Search This Site...
Search This Site...
Beginning Farmer Workshop Advises on Land Purchase Preparedness

Beginning Farmer Workshop Advises on Land Purchase Preparedness

11/15/2017 12:30:00 PM/Categories: Popular Posts, General News, Today's Top 5

The Boy Scout motto “be prepared” rings especially true for beginning farmers or ranchers planning to purchase land. Being a ready, willing and able buyer is essential to securing farm and ranch land, agreed a panel of real estate experts during a beginning farmer workshop Nov. 13 at the Montana Farm Bureau Annual Convention.

Colter DeVries, Clark Land Brokers, said often people want to talk to a real estate broker before visiting with a banker or loan agency. “However, I should be the person you talk to after you make a plan and address your financial needs. Ask yourself preliminary questions, such as how much savings or equity do I have for a down payment? Will I be consolidating closing costs and appraisal fees into my note or paying cash? Will a family member co-sign or guarantee a certain portion of the loan?”

Bo Kombol, Northwest Farm Credit Services, said the first step should be setting goals and determining how to achieve those goals. “Make a balance sheet. Do a real estate business plan. See if your plan will cash flow,” he advised. “Meet with a lender to see what you can actually afford.”

“Too many people overstate their income and understate their expenses,” said Bruce Johnson, Farm Service Agency. “Identify your strengths and weaknesses. Reconcile your beginning and ending cash. That will tell you what you can afford. First go to your local banker, but if you’re declined, shop all options from private and local to national banks and insurance companies. Remember that you will need a decline letter to be considered by the FSA.”

Once your plan has been deemed workable by a bank, the FSA or other credit sources such as the NWFCS or Montana Livestock Ag Credit, then visit with a buyer broker specializing in farms and ranches. It’s wise to have a letter of intent/pre-approval from the bank to show your broker that you are legitimate and can be taken seriously.  This also provides you with an idea of what you will be able to realistically afford.

Allow sufficient time to get the loan and have work done before you even produce a buy-sell agreement. “People think it can all get done in 30 days, but that’s almost impossible. Give yourself 90-100 days,” said Kombol.

Johnson explained that FSA loans take an especially long time. “We can get a long way down the road before the buy/sell. First FSA needs to identify where property is. If there is going to be any construction or ground disturbance, we have to check for cultural resources. Our appraisal process is long. It’s a tricky process.”

DeVries said due diligence is essential. “Meet with the sellers and ask about the past performance of the land, the state of the water rights, relationships with neighbors and so forth. Have a vision and a budget for that vision. Remember, if something is wrong or it’s out of your financial comfort zone, no farm, ranch or parcel is so unique it cannot be passed up. Keep it strictly business and don’t marry the land.”

Finally, expand your knowledge base. Extension, the Farm Credit Business Management Center, the Natural Resource Conservation Service and other institutions offer webinars, conferences and on-line classes to provide information about finances, programs and creative ideas that can help new farmers achieve success. 


Source: MT Farm Bureau Federation

Photo: NAN



Print

Leave a comment

Name:
Email:
Comment:
Add comment

Name:
Email:
Subject:
Message:
x

Recent Ag News

Hill & Agency Visits Essential Part of Montana Farm Bureau D.C. Fly-In

7/18/2018 6:06:00 AM
Visiting with elected officials and meeting with agency personnel is a critical part of advocacy. When three Montana Farm Bureau members earned a trip back to the nation’s capital as part of the Advocacy and Action Incentive Program, they had an excellent opportunity not only to tour the Capitol and the White House, but to meet with their state’s Congressmen, visit with the major decision makers at the United States Department of Agriculture (USDA), and glean critical information from American Farm Bureau’s public policy team. >> Read More
Article rating: No rating

Montana 4-H Ambassadors Announced

7/17/2018 2:44:00 PM

Recently, at the conclusion of the 2018 Montana 4-H Congress held on the campus of Montana State University a new batch of 4-H Ambassadors was announced. 


>> Read More
Article rating: No rating

MWBC Welcomes Two New Directors

7/17/2018 1:38:00 PM

Great Falls, Mont.— Governor Steve Bullock recently announced the appointment of two new directors to the Montana Wheat and Barley Committee (MWBC). Adam Carney of Scobey, will replace District 1 Director Buzz Mattelin of Culbertson, while Charlie Bumgarner of Belt, will replace District 5 Director Bruce Myllymaki of Stanford. Both Mattelin and Myllymaki are termed out, having served on the committee for 9 years.


>> Read More
Article rating: No rating

Livestock Groups Launch Media Campaign in Support of Barrasso Endangered Species Act Amendments of 2018

7/17/2018 8:55:00 AM
WASHINGTON (July 17, 2018) – The Public Lands Council (PLC) and the National Cattlemen’s Beef Association (NCBA) today launched an online campaign to educate the public on the need for a modernized Endangered Species Act. The campaign, which focuses on the ranching industry, highlights the importance of working landscapes in improving ecological services and achieving species conservation targets. >> Read More
Article rating: No rating

Montana Youth Shine at Little Britches National Finals Rodeo

7/16/2018 2:20:00 PM
More than 1200 Youth competitors from more than 30 states, including 20 contestants from Montana, were at the Lazy E Arena in Guthrie OK to compete for championship honors and nearly $380,000 in awards and scholarships.  >> Read More
Article rating: No rating
RSS

Find Articles by Date

«July 2018»
MonTueWedThuFriSatSun
38
15
19202122
23242526272829
303112345