Financing Your Farm Equipment
Farms and agriculture in general are a vital building block to any economy, providing food, clothes, and raw materials for any number of other industries. Unfortunately, being vital doesn’t always equate to a massive paycheck, and agricultural equipment isn’t cheap as a rule. We here at Flieg’s Equipment know you’re on a budget and want you to have all the tools you need, so we’d like to talk you through the first few steps of financing your farm equipment, below. To learn more, or to see the farm equipment we have for sale, contact our stores in Ste. Genevieve and Leadington, Missouri, today!
1: Budget
Like in any financial decision, your first step should be to create a firm budget. You’re going to want to find a balance between what’s realistic for the market and what you can reasonably afford without sacrificing other finances. Start with a bit of research on the average prices of the equipment you’re interested in, then look through the available loan rates and terms. Remember to factor in things like fuel, regular maintenance, emergency repairs, and any accessories you’ll need—and all loans will require that you pay interest, as well!
Once you have all that, think about how much you can afford to pay up front and what you can pay monthly. Factor in your income, spending habits, regular expenses, and emergency funds.
2: The Lender
Next, consider where you’ll be getting your loan. Just about any financial institution offers them, including banks, credit unions, and lending institutions, and you can even get some loans right from certain dealerships like us at Flieg’s Equipment! Whether or not you’re already a member at that institution, you’ll likely be able to get a loan, though loans through banks or credit unions you are a member of will have better rates and terms. Credit unions especially are known for relatively low interest rates and high total loan amounts.
3: The Loan
Finally, consider the type of loan you’ll be aiming for. There’s a lot of variety in that department, but the two biggest categories of loan are secured and unsecured. A secured loan is easier to obtain, even if you have a low credit score, and they often have smaller monthly payments over longer periods of time. However, if you default on your loan, the equipment you’re paying off may be repossessed as collateral.
An unsecured loan typically requires a higher credit score, and they have shorter terms and higher monthly payments. However, they don’t use your equipment as collateral, so it can be a lower risk option if you can afford it.
We hope these steps help you get started on your financing journey! If you have any questions, want to speak to our financial experts, or just want to browse our selection of farm equipment, contact us at Flieg’s Equipment. We proudly serve the people of Farmington and Park Hills, Missouri—let us serve you today!