All You Need to Know About Financing Farm Equipment
Farm equipment can be expensive, and you might be on a tight budget. Thankfully, you can finance the machines you want and pay them off bit by bit! This way, you can get your equipment without breaking the bank.
We at Manor Home Center know the importance of having the right tools for agricultural operations. We’ve put together some tips on financing farm equipment to help you get what you need without making too many financial adjustments. Read on to learn more, then contact our finance experts to get a plan customized for you.
Plan a Realistic Budget
Start by crunching some numbers to create a realistic, affordable budget. Find the average price of the equipment you’re looking for, then look at rates and terms of various loans that might be available. Remember to account for a significant down payment, monthly installments, and future costs like maintenance, repairs, accessories, etc.
Find the Right Loan
Once you opt for a loan, you’ll need to send monthly payments to your lender for the next few years. That’s why you must seek a loan you can afford without impacting your spending habits. The interest rates, loan terms, and other factors vary by the lender, loan amount, type of loan, and your income and credit score—so keep your options open.
Secured loans are easy to obtain even if your credit score isn’t perfect. These tend to have longer repayment terms and lower rates, but they’ll use your equipment as collateral. If you default on your loan, they can repossess the machine.
Unsecured loans require higher credit scores to obtain, have shorter repayment periods, and tend to have higher rates. However, these loans don’t use the equipment as collateral.
Find the Right Lender
Although you don’t need to be a bank or credit union member to get a loan from them, you can get better deals on loans if you are one. So, start by approaching credit unions or banks you already use for a loan. They can help you learn more about the types of loans and the various options they offer. Credit unions are good lenders since they’re nonprofit businesses. They give higher total loan amounts at lower interest rates.
We hope this guide helps you get the equipment you need when you need it. If you have any questions or are ready to explore farm machines in person, contact us at Manor Home Center. We happily welcome Oakland and Garrett County, MD—let us serve you today!