Agricultural loans: features, who sells them

Agricultural loans: features, who sells them

A category dedicated to agriculture and livestock is that of agricultural loans: companies operating in the sector may apply to banks that offer them. We see the conditions and institutions that deal with agricultural loans.

Loans to agriculture

The so-called agricultural loans are a particular category of loans that not all institutes provide the benefit of companies and enterprises involved in agricultural and livestock.

To distinguish it from other types of loans, we specify which ones are for the purchase of agricultural holdings, land for agricultural use, a complete renovation and expansion of businesses, creation of structures. In short, this is a resource with which the industry can finance their farming activities.

Who can benefit

Although we have already specified as it is a type of funding dedicated to operators in the agricultural sector, adding that agricultural loans are for specific companies, organized both individually and collectively, which operate in the following areas:

1. Agriculture.

2. Livestock sector.

3. Agro-industry.

4. Farm sector.

Features of the loan

The agricultural loans have features similar to traditional mortgages.

He thinks about the extent of the sum to borrow which must be repaid by instalments that may have a monthly, quarterly or semi-annually.

Of course, we must determine what type of interest rate to be applied: Fixed or variable are the two possibilities, as well as all types of mortgage.

The term of the loan provides for a standard period of 20 years, but agricultural loans provide incentives to do so for young people under 40 years (duration extended to 30 years).

Warranties

Like any loan, including the agricultural loans provide the guarantees to which the beneficiaries must absolutely abide by. In particular we talk about:

1. Mortgage real estate.

2. Pledge money.

3. Rights to the finished products.

4. Entitled to the funds.

5. Rights to the goods purchased.

6. Rights to future sales.

Of course it's different options that the farm and the Bank may agree with the time of entering into the contract for the lighting of new agricultural loans. It is sometimes necessary safeguards that protect the bank from situations of failure and lack of reimbursement by the agricultural enterprise.

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