Central Nebraska | Ironbender - 9/20/2016 09:30 If you have an operating loan they probably already have a blanket security agreement that covers everything you will ever own. I'd let him know that I'm shopping for a new bank and see what he says. Just because they ask for things doesn't mean they will get them.
Any banker worth his salt will have a blanket security agreement filed against your machinery and equipment, growing crops, livestock, proceeds, government payments, etc. Basically, anything that is not a titled vehicle is covered by this security agreement. They will then file that security agreement with the appropriate agency in your state (Secretary of State in Nebraska) to put others on notice that they have a security interest. There can be multiple filings but the first/oldest has priority. The only way to get in front of the priority filing is by asking them for written subordination OR, if purchasing a new piece of equipment, to notify them in writing within ten days of delivery. Also, that filing is suppose to notify grain/livestock buyers that checks are supposed to include the bank as a payee. This is to insure that the proceeds are able to be applied to the banks operating loan. The bank can decide if they are going to apply it to the loan or simply deposit it to your account.
This seems to be a recurring question/frustration here on AgTalk that I simply don't understand. If you/I go to a bank and request to borrow money they have every right to protect their investment in your operation and will most likely choose to over protect themselves. All pledged assets are going to be discounted to account for depreciation, market changes, spoilage and misrepresentation. Real Estate is generally the least discounted. Machinery is the most discounted. |
Banking Question
