The U.S. Chicken Housing Crisis
- Thread starter Anonymous_IHB
- Start date
NEW -> Contingent Buyer Assistance Program
I used to work for Farm Credit Services. Those contracts for chicken delevery were viewed as iron clad (even though they aren't). If you get a contract, somebody will finance you. This wasn't bad business plan, they haven't not renewed a contract in 40 years!
My job at Farm Credit was foreclosing on that sort of guy. Sometimes circumstance got you, other times the borrower was an idiot. The risk he has is the same risk that every other grower faces every year. He lost the lottery.
I'm trying to be nice, but you don't know what you are talking about.
There's always a risk. But it hadn't happened in so long everyone assumed it wouldn't. And it's still pretty remote. Of the 8000+ contracts out there, 300 weren't renewed. Once. Oops.
The 'trust' factor in these rural areas is huge. Your word actually means something. Farm Credit didn't loan the 27 year old 500K using NINJA financing. There are likely several hundred loan officers over many states not sleeping at night over this.
Yep, I was thinking that even some "good" loans were going bad.... So what happens to the loan officers when things like this go south? As you mentioned it was a very safe loan with little risk associated with it.
As for ninja financing... even i don't get too many breaks. I've always had to put 30-40% down to make the numbers work out.... annoyingly high, but in hindsight a very, very good thing.
-bix
while it is true that I may not know what I am talking about regarding farm lending, that statement above eerily reminds me of "housing prices never go down"
freedomCM_IHB
New member
a 27yo ice truck driver was able to take out a 532k loan and net 150k the next year? yes, good business plan. until it wasn't
no_vaseline_IHB
New member
freedomCM said:
I used to work for Farm Credit Services. Those contracts for chicken delevery were viewed as iron clad (even though they aren't). If you get a contract, somebody will finance you. This wasn't bad business plan, they haven't not renewed a contract in 40 years!
My job at Farm Credit was foreclosing on that sort of guy. Sometimes circumstance got you, other times the borrower was an idiot. The risk he has is the same risk that every other grower faces every year. He lost the lottery.
I'm trying to be nice, but you don't know what you are talking about.
biscuitninja_IHB
New member
Very interesting, but still its kinda a risk don't you think. I do not know much about chicken farming, but betting on a not renewed contact has always been kinda a gamble (even a safe one). Anybody want to purchase some cheap chicken houses?
-bix
-bix
no_vaseline_IHB
New member
biscuitninja said:
There's always a risk. But it hadn't happened in so long everyone assumed it wouldn't. And it's still pretty remote. Of the 8000+ contracts out there, 300 weren't renewed. Once. Oops.
The 'trust' factor in these rural areas is huge. Your word actually means something. Farm Credit didn't loan the 27 year old 500K using NINJA financing. There are likely several hundred loan officers over many states not sleeping at night over this.
biscuitninja_IHB
New member
no_vaseline said:
Yep, I was thinking that even some "good" loans were going bad.... So what happens to the loan officers when things like this go south? As you mentioned it was a very safe loan with little risk associated with it.
As for ninja financing... even i don't get too many breaks. I've always had to put 30-40% down to make the numbers work out.... annoyingly high, but in hindsight a very, very good thing.
-bix
freedomCM_IHB
New member
no_vaseline said:
while it is true that I may not know what I am talking about regarding farm lending, that statement above eerily reminds me of "housing prices never go down"