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Financing Equipment

P

PureCountry

Well-known member
Joined
Oct 25, 2005
Messages
2,684
Location
Edgewood, BC, moving to Hardisty, AB
Wow, I have to say that financing equipment is proving to be downright frustrating. I've done alot of financial stuff over the years, with bigger numbers than this, but we're trying to finance some equipment right now and the only thing they haven't asked for is blood......yet.

They want more info than when we borrowed money to buy the land in the first place. Full financial records for 3 years, letters of reference from my off-farm employer proving my oilfield income, and a full business plan written out detailing who our competitors, suppliers, customers and I swear, legal custodian to my kids will be.

I don't know why they can't look at my income, the farm income, and give me a simple yes, or no. The tax returns don't lie, so if the income is there to make the payments, you either want us as a customer, or you don't. Should be simpe, right?
 
What kind of a lender are you dealing with? I have found banks to be a pain in the rear, around here they have no idea about anything ag, and don't seem interested to learn. Farm Credit and our local Credit Union are usually the best bet. Farm Credit actually makes me nervous because it's almost too easy.... they'll lend money on a phone call. Farm Credit tends to charge a bit higher interest though.
 
Could planning a move to another province be part of the problem? I know when we moved machinery from Wyoming to SW Montana the bank let us move mortgaged equipment out of state. At the time, (1975) we didn't think much about it, but then we found out that is almost unheard of........ :?

I know too, that you have to jump through way more hoops than we are used to, thanks to banks' past practice of loaning too much money to the wrong people.

Good luck to you Pure. I hope it all turns out good for you and your family.
 
Many yrs ago, I was just about ready to sign on the dotted line.

Mr Banker said "Now, we'll just get your Dad to co-sign this and we'll be good to go!"

I said, I got another idea, Bob--I've banked here my whole life, you got at least 3$ security for every dollar i'm borrowing, plus got that equipment tied up. And i'm a big boy, even own my own car! And that car is fulla gas and there's another bank 25 miles down the road, and they rent money too and I don't need you---I'm the customer here, I like them folks down the road plum fine also, reckon i'll mosey over there and see about renting some of their money and you can rent yours to somebody else.

That's about 40 yrs ago, i'm still at same bank, Bob was a good ol' boy, said 'guess you got a point'---
 
PureCountry said:
You tired of rain down there yet? I heard almost 2" at Limerick and it was headed east after dumping down there.
Click to expand...

Most of the rain goes around us. We had less then 2 inches in all of July. Got a 1/2 inch today but could have used more. :D
 
Silver said:
What kind of a lender are you dealing with? I have found banks to be a pain in the rear, around here they have no idea about anything ag, and don't seem interested to learn. Farm Credit and our local Credit Union are usually the best bet. Farm Credit actually makes me nervous because it's almost too easy.... they'll lend money on a phone call. Farm Credit tends to charge a bit higher interest though.
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Ditto.

The big banks don't want anything to do with Ag. To even get them interested, you would probably need 50% down. Why lend to ag when CMHC insures homes and takes away the risk.

Farm Credit is scary with how loose they are with money. A lot of farms here would not be in existence without them - the risk would scare any normal person.

I would put my vote in going to a Credit Union. You might actually get an account manager that has been hit in the face with some cow shyt before.
 
I think littlejoe is right. Those requirements would make more sense for a start up commercial venture, not an established farm or ranch with an off farm job. It sounds to me like they know nothing about agriculture and are just trying to fill in the slots on their checklist. I think I would look to another lender. If you are buying from a dealer most of them have financing as well. It could be they just don't want the ag business but don't have the nerve to say so.

It has always amazed me at how few really good ag lenders there are around the country. I know it is that way in my area and apparently in other areas as well. Agriculture is a huge block of business for lenders and a profitable one too but few are interested in it. I spent 30 years as an ag lender and still don't understand why more lenders are not interested in agriculture. I'd look elsewhere if I were you. You are right, it shouldn't be that difficult.
 
That's exactly how they're looking at it, like a startup commercial venture. This is a small bank that deals mostly with small businesses and entrepreneurs. Didn't think it would turn into a hassle so I've been on the phone with other lenders this morning, including Farm Credit. Main issues are, we're moving to a different province, taking over an existing farm business, but the previous owner won't share any of his financial history. Thus, we get treated as startups.

Oh well, there are other fish.

BMR - Shaunavon got showers on the weekend and most of the day yesterday was off/on. Trying to find some dry ground for crews to work on today, but everywhere we try to work the environmentalists have to sweep it first for Leopard Frogs and bird nests. Makes things move slow as a turd of hurtles.
 
PureCountry said:
That's exactly how they're looking at it, like a startup commercial venture. This is a small bank that deals mostly with small businesses and entrepreneurs. Didn't think it would turn into a hassle so I've been on the phone with other lenders this morning, including Farm Credit. Main issues are, we're moving to a different province, taking over an existing farm business, but the previous owner won't share any of his financial history. Thus, we get treated as startups.

Oh well, there are other fish.

BMR - Shaunavon got showers on the weekend and most of the day yesterday was off/on. Trying to find some dry ground for crews to work on today, but everywhere we try to work the environmentalists have to sweep it first for Leopard Frogs and bird nests. Makes things move slow as a turd of hurtles.
Click to expand...

I think it's Kelsey working on the last Canadian leg over this way.

B&A did the leg right north of us last fall/winter.
 
Ya, that Kelseys outift has never done pipeline before, and that spread they're doing is almost all native prairie. It's been a bit of a gongshow apparently. Once you accept that the rules are the rules and you never win arguing with Saskatchewan Environment about native prairie. They protect it very well, which is great to see.
 

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