Shit is getting real !

[Guest]

Our bank has decided they don't want to deal with us anymore and told us to go looking , things are pretty ugly, What are the chances of another lending institution taking over someone else's problem ?
Any suggestions from some else who has dealt with this sort of situation and is still farming?

[hobbyfrmr]

I know of 2 farmers who went bankrupt. I dont know the bad details but within a couple of years the were farming more land than they ever had with much more modern equipment. The one fellow even kindly offered to me that if I get into financial trouble he could advise me how to make my way out of it.
Somehow your allowed or you have the right to one set of equipment to make your living.
Thats a rather poor description but I hope it helps.

[RTK]

You need to get your numbers together. If your bank wants you to leave a good chance they are not properly secured. So know what you have pledged as security and is it realizable security. You need to take a hard look and decide can you make this work - be realistic. I had a few farmers exit the industry because I was honest with them - some were not happy with me at the time but now all of them have made successful lives after farming and we visit as friends now. I have worked with farmers that I felt we had a chance to fix the situation - but once again I was honest with them and the offer involved better or fixing my security and together we agreed on an exit strategy if things went sideways. My rule was wife had to be involved so the couple knew what was a risk. Do bankers take on new files - yes I had growth targets and I secured myself and made sure we had what I felt was a workable file. I have since moved on from banking - I worried to much about my clients. Best time to be looking at other lending institutions is after harvest and plan to take most of the winter to build a package.

[RTK]

I am going to add this thought as well; I was in situations where other creditors lost money; my rule was I understand this happens when thing go bad but in those situations my rule was if that was what it took to keep farming then sorry I was not going offer a package to allow the farmer to continue at others expense. In those situations I was looking to find ways to wrap up the farming operation and help the family move on (ie relocate to home and make sure a vehicle, tools etc was able to be purchased to get them back on their feet.

[Partners]

I always thought that banks don't care if you ever pay stuff off..All they want is the yearly interest ..

[riders2010]

Ya right they lost money!!!
Hahahaha FCC and other lenders more and more
Only want the big wheels with the fancy accountants and the bigger you are the more lee way they give those guys but family farmers a little problem and they *** can't wait to tell you they know some asshole that's waiting to take your land. Or better yet they tell you to sell and rent then when you tell them the rent is they say hey that doesn't work. Well dah.

If your in trouble do what ever you can to keep your land. And get another crop. A good crop can change things around quickly.

Sometimes I m not so sure some of these lenders aren't on the millionaires pay roll to turn down loans and then direct the land to their keepers.
But hey it's tin foil hat day isn't it? And what doi know only an option. But I see more and more the assholes and crooks getting the loans they need to keep going and re honest people getting screwed.

[RTK]

Riders - think you missed my point. I dealt with honest and good intentioned farmers. I had guys come in with fancy consultant made plans or sat down with the farmer; consultant; accountant; lawyer only to listen to a power point presentation and for me to ask about 3 questions before I knew I wanted no part. A good lender with sit down with a farmer and blank sheet of paper; make a list of information he needs the farmer to supply him with; then the lender and the farmer put together a
simple business plan that supports repayment. FCC has created an unfair playing field and to be honest hurt a lot of guys and picked winners and losers. As lender I steered files there that I wanted no part of for a reason...

[sumdumguy]

We started a company in 1986, were dealing with a small local bank. A new credit manager was brought in to clean up a couple of farm businesses that were tetering on the edge. Remember times were bad in ag those years. This bank called the loans of seven busiinesses including one big chemical business in Regina because they could. Well, we got caught up in that and had to leave. It was traumatic but very quickly turned into a great experience with a super lady banker in the city. We had good security and very little risk. Turned into no complaints for 25 years. See - some pain does pay off.

[Guest]

I'm reading every post guys, I really appreciate any and all information. The bank suggested we do a financial plan last year which we did , I'm not big enough to justify a timely response to the plan we presented them and it wasn't addressed by the bank until the middle of May at which time they said they don't want us anymore.
So much for the $10k financial advisors advice hey?!!

[SASKFARMER3]

First Relax.
If its a Major bank something changed in Head office or your area has been hit by floods or Hey it could be anything. You would have known something was happening a few years earlier and that was probably the best time to move.
Look at your assets and cash flow.
Yes shop around you have a busy stressful few months with lots of promises and failures but in the end if you can refinance at todays interest rates and change a few things you might be able to continue.
Don't get into bed with the fancy talkers on the Radio to help your farm. Big farm our way is on to there third sale and still not done.
So good luck get all your paper work in order find out what you actually own and what your debt is some shit might have to go but there always is a solution.
Good luck.

[Klause]

Don't you have to do one every year ?

We do every January....

[iceman]

Spot on SF3

The banker got told to de risk his portfolio and your number came up. This has happened time and time again in the industry. Very common in the 30s and even the 80s for bankers to call in loans that have never been defaulted on.

Get your numbers together including that business plan and go shopping for a new bank. Good luck and remember these experiences will only make you stronger

Iceman out

[RTK]

This is an area that I have some experience as a banker. Sorry to hear that a consultant charged 10k for a business plan - not all is lost here - that is a perhaps a good supporting document. SF3 made some great points. Here is my approach - get this crop harvested so you know where you are at... Take a serious look at your situation and decide is continuing the right way or is it because that's all you know? This maybe a case of a bad lender and improperly structured debt without numbers I no idea. Now build your own plan this includes - detailed balance sheet (include loans, payments, security); list total acres farmed rented vs owned. You can do a simple income statement and make copies of 3 years of tax returns. From this information a lender get a nice easy to handle package; you can attach the booklet the consultant gave you as well. Then book some appointments. Did the bank tell you to see a consultant that charged $10k?

[Guest]

Yea RTK, the bank told us to see this consultant, it's part of the "growing forward" program so we will receive a percentage back.
It seems like an outrageous fee for these results, Resembles an insurance claim to me, the cost of things quadruple as soon as there is insurance money connected.

[RTK]

My auditors really liked those fancy plans - not one of them understood them. I alway found the more elaborate the plan the more risky the loan. Is waiting til after harvest an option - I think if they waited til May to tell you to move on they have no clue about farming. Make sure you shop around to a credit union as well - land debt and machinery is simple for them; operating is where CU will struggle compared to banks.