Securing commercial mortgages for farms aren’t easy, and it seems to get more difficult as time goes on, that’s not to say getting an agricultural mortgage is impossible though.
What is a Commercial Mortgage for a Farm?
A commercial mortgage, and in this case an agricultural mortgage is a form of loan that is designed for agricultural, rural, or equestrian properties.
Most commonly, they are used to purchase or refinance farms, farmland, and associated buildings.
How do lenders decide if I can get a Commercial Mortgage to buy a Farm?
Every lender or bank has their own set of requirements that need to be met.
Some of the thing’s lenders will look at are:
- Credit history
- Income and expenditure
- The property you’re purchasing and its own business history
- How much deposit you have available
It’s important for the lender to feel reassured that you could repay this loan, which is why seeking a commercial mortgage to buy a farm can feel quite challenging without a finance brokers assistance.
How much can I borrow with a Commercial Mortgage?
Loan to values depend on the type of farm you are buying, but typically the maximum LTV available is 80% which as a borrower means you would need a 20% deposit.
The LTV is based on the farm type and your affordability. The better your borrowing history and affordability, the better chance of getting a more favourable LTV rate.
How long does it take to get a Commercial Mortgage to buy a Farm?
The commercial mortgage process can take anywhere from 8-12 weeks from start to finish.
The time taken to complete the application will depend on the complexity and nature of the transaction.
If you need the funds quicker than this, a short-term bridging loan may be a more suitable option.
Working with Amplo
At Amplo, we work with a large panel of lenders, including agricultural finance specialists to ensure you get the best deal possible.
We will submit the application on your behalf and work with the lender, taking the stress away from you, enabling you to carry on growing your business.