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Thumb of Michigan | The outgrowing banks comments seem to draw a lot of criticism. Not sure why, I guess all areas are different. My father "outgrew" 2 banks at about the same time. It was in the late 60's/early 70's. One bank was trying to lower its ag exposure and stopped writing new loans, one was a truly local bank and didn't have the reserves to fund as much "expensive" ground anymore. It was approaching $600 per acre for gosh sakes. When he was in the process of buying land, it was getting to be an annual event for him. The numbers worked, the downstroke was there, everything was in place. The bank he'd always worked with was a small regional and simply couldn't keep up with the demand for cash. From many of its farm customers, not just one or two. Anyway, at the time my Dad would have been characterized as a BTO had the internet been invented then. Probably would have held that status for a month or 2 even, until another neighbor took the title over. The Federal Land Bank was in the county seat and seemed to want to lend money for farm land, so thats where my Dad ended up landing. Even served on the board of the local PCA after a few years, and most everyone else on the board with him had similar stories. They wanted to expand and the local bank was the limiting factor in the equation. PCA and the Land Bank (before they combined) were there and a lot of people were glad for it. Its a bugger when you want to expand, have the will and desire as well as the numbers to back the plan, and don't have the access to capital to make it all come together.
Sourcing capital isn't just a farm thing at all: easy to find that issue in many business's now, especially after the whole banking debacle and consequent non bail out bail out. There's a thriving secondary market to loan cash to smaller as well as some larger companies, I have friends participating in that arena as we speak.
I'm aware of a number of farms who've outgrown Farm Credits capital limitations as well. They end up going to places such as Wells Fargo. Or life insurance companies. Wonder how many of the posters here have funds tied up in some mega operations via your insurance premium and don't know it? Anyway, it usually seems to work. Except when it doesn't. Just like any other business in the US.
I have no knowledge of whats going on at all with the Stamp deal. Don't know the owner or anyone else related to the operation. Never heard of them until the magazine article last week. No one has been able to provide a link to anything concrete bad or good happening so I guess I characterize everything so far as gossip. Yep, even if someones brother in laws best friends sister is dating the fuel delivery guy and he knows the facts for sure.
Edited by pat-michigan 11/20/2012 11:27
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