When looking for a mortgage to acquire an agricultural land, it is always vital to talk to the mortgage brokers Kelowna to make sure that you are getting a mortgage that matches your situation. Even though there are a lot of parallels between consumer mortgages and agricultural mortgages, the latter are specially designed to take care of the requirements of rural landowners.
At the point of considering whether to provide a mortgage or not, most mortgage companies limit the number of acres they are eager to include as part of the assessed value of an agricultural property.
Just like with other kinds of properties, agricultural mortgage lenders’ mortgage rates differ dependent on a range of factors, such as credit worthiness and financial qualifications of the borrower, mortgage type, the property’s equity value, existing market conditions, and the principal amount.
There are basically two sorts of agricultural mortgages; fixed mortgages and variable rate mortgages. Fixed mortgages come with a set rate of interest that are usually a bit higher than for variable mortgages, but a fixed mortgage guarantees an interest rate that will remain unchanged throughout the tenure of the mortgage. On the other hand, the mortgage rate on a variable mortgage changes based on market conditions, and this could be difficult for an exacting farming budget because the monthly mortgage payments are likely to fluctuate.
Refinancing of Agricultural Mortgages
If the present-day mortgage interest rates are not as high as your existing mortgage interest rate, it could be a good idea to contemplate a lower rate refinancing, even if you suffer a penalty to pay up your present mortgage. Your mortgage brokers Kelowna would be happy to have a meeting with you to find out if agricultural mortgage refinancing would be of benefit to you.
Also, the equity on your farm property would be useful for other projects like purchasing farming equipment, debt consolidation, or financing your child’s university education or wedding.