|
Jesup, IA | Take the 30 year amort, 15 year fixed @ 5.75.
Why -
Sometime in the next 15 years 5.75% will look cheap. Not just for land money, but for operating loans, equipment, etc. Put enough down on this farm to make the payments like rent (bet you always pay the landlord somehow, so this is a safe debt level).
Be frugal, make the payments on this farm but use any extra cash flow to farm "banker free" or "banker light".
Yes, savings 100 or 200 basis points on this loan with a shorter term fixed rate would result in a lot of savings, but someday interest rates will change, and I suspect they will go up fast. And probably at a time when creditors are not very interested in underwriting any new loans. You will have cash & be in control. Play for the long game. | |
|
which loan for land purchase?????
