Farm loans driving vacation home investments
Investors are increasingly using farmland lending programs to build vacation homes out on the range, according to a special report at MarketWatch.
Montana, Texas and Wisconsin are seeing an increasing number of homebuyers using farm-based cooperative lenders to access funding for their vacations ranches, where rates can be as low as 2 percent:
Northwest Farm Credit Services, which is based in Spokane, Wash., and lends in Alaska, Idaho, Montana, Oregon and Washington, says it has been touting its low interest rates, which start at 2.6%, to buyers who had intended to buy these properties with cash. Their net rate can be even lower: The lender pays out an annual return to its members that has been averaging 0.75% over the past two years. Roughly 25% of its clients who have been purchasing $1 million to $14 million ranches over the past two years have been signing up for financing, says Mark Dvarishkis, a vice president at Northwest Farm.