Farm Machinery Loan For Expanding Your Agricultural Business

Increasing complexities and magnitude of farming and agriculture have lead to the

invention of farming machinery which speeds up the process of farming while reducing the dependence on labour as well. Knowing the complex functions which farming machinery perform, they are undoubtedly expensive and for purchasing them would lead to requirement of farm machinery loan.

Farm machinery loan is available on special farm machinery such as Tractors, power tiller, ploughing equipment, planting equipments, combine harvesters, irrigation systems. However there are certain prerequisites to availing farm machinery loan UK.

Farm machinery loans are offered depending up farmer's requirement. In UK, farm machinery loans are offered in the range of GBP 10000 to GBP 150000. Farming itself is an unpredictable activity which makes it imperative to offer highly flexible loans. Farm machinery loans can be availed to buy new farm machinery or second hand farm machinery.

You could avail farm machinery loans either through fixed rates, variable rates or prime rates. Farm machinery loans taken under fixed rates means your installment is spread over fixed period of years viz 1 year to 10 years. The loan repayment amount will be relatively small since the loan period is spread over a period of time.

You could also opt for farm machinery loans through variable rates. Through variable rates, the interest rates shift according to the varying rates in the markets on monthly basis as well. The term of repayment options of loans on variable rates is between 7 to 10 years.

Lastly moving on to loans offered prime rates imply specific margin to prime rate. In case of any change in the prime rates, the interest rate also changes. These loans have a margin lock of 1 to 3 years while they can be repaid within 7 to 10 years maximum.

In case you approach special financial institutions you could also raise capital from your existing property and expand your farming business considerably. In case you have loans from multiple sources you could always consolidate all your borrowings into a single affordable loan. These financial institutions also offer repayment holidays which mean you do not have to pay for the initial years (usually 5 years) after which you do have to pay a slightly higher amounts of installments considering the accrued interest.

All in all, Farm machinery loan is easily available. You need to finalize the farm machinery you wish to equip your farm with and approach the financial institutions with your loan form. At the same time you could even think of ambitious farm expansion plans and increase your agricultural business as well.

by: Mark Taylor

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