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WC MN | Deere, I was in the same situation as you up until last month. I farm, and work full time as an ag lender. This is my 10th year farming and I just bought my first farm using the fsa 5% down loan. First off, cash IS king. Manageable debt IS OK. Interest rates on mortgages are very cheap, if you're not paying less than 4.5% on your debt get it refinanced asap. With recent reg changes it takes 30+ days for a real estate loan to close if everything goes as planned. By paying off a mortgage you are potentially giving up equity if the value decreases. Also dealing with FSA HERE (wc mn) you want as few moving parts as possible. With a declining ag economy I feel that quick access to cash is vital and not many of us young guys have that. So pay off all your operating loans and be patient. 2-5 years is not that far away!
If you have working capital you have options. If you don't have working capital, you have to ask "what are my options" and pay a higher interest rate. | |
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What to do with cash
