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Residential
mortgage financing in Rural America may involve a homeowner
conducting or planning to conduct a small farming operation.
The homeowner desiring to live in Rural America now has long
term fixed rate financing available for the property with both
a residence and a farming operation. |
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Key
Criteria for Part-time Farm/Residential Loans: |
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- Single-family,
owner-occupied detached residence located on the property.
- As
a guideline, the contributory value of the Dwelling should represent
25 to 50% of the total appraised value.
- If
the collateral is 5 acres or less, a minimum of $5,000 gross
agriculture income must be produced annually
- If
the collateral is greater than 5 acres, there is no minimum
ag income requirement, however the property must produce
some ag commodity.
- Private
Mortgage Insurance is required on loans with a Loan-to-Value
greater than 80%.
- Maximum
Loan-to-Value is 85%; Max CLTV 85%
- Loan
must be secured by a first lien.
- Maximum
Loan Amount $3 million.
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Advantages
of Our Part-time Farm/Residential Loans: |
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- Competitively
priced 15 or 30 year fixed interest rates.
- Standard
residential mortgage documents and credit underwriting criteria.
- Monthly
payments.
- No
escrow for property taxes and hazard insurance is required.
- No
pre-payment penalty
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Home
Loans for the Part-time Farmer: |
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- Property
must be used for both residential and agricultural purposes.
- No
maximum acreage limitation.
- A
private road may access property.
- Easements
may be permissible provided such easements do not render
the property unmarketable.
- Property
may be located in areas less than 25% developed.
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