Mortgages/Agricultural Loans for Woodland.

  • Hey Guest, We're having our annual Winter Moot and we'd love you to come. PLEASE LOOK HERE to secure your place and get more information.
    For forum threads CLICK HERE

TeeDee

Full Member
Nov 6, 2008
8,493
2,112
47
Exeter
I think many of us have talked about it , a few have looked into the Rabbit hole and some have even done it but what is the down and dirty skinny on getting agricultural loans or mortgages( Not sure if thats the right term ) on Woodland?

Can anyone share some recent information of substance.?
 
  • Like
Reactions: CLEM

gra_farmer

Full Member
Mar 29, 2016
989
567
Kent
I think many of us have talked about it , a few have looked into the Rabbit hole and some have even done it but what is the down and dirty skinny on getting agricultural loans or mortgages( Not sure if thats the right term ) on Woodland?

Can anyone share some recent information of substance.?
In relation to the loan, it all depends on what you want it for, I.e. business or just interest land purchase? Often it will be looked at as business, so ideally you would have a limited company setup, with at least 3 years worth of books and a business plan for the purchased land.

If classed as domestic, they will take your house into consideration as payment insurance, as pretty much a second mortgage.

If the latter applies, the land will need to be close to your home, as fragmentation of property is considered a risk.
 
Last edited:
  • Like
Reactions: TeeDee and nigelp

TeeDee

Full Member
Nov 6, 2008
8,493
2,112
47
Exeter
In relation to the loan, it all depends on what you want it for, I.e. business or just interest land purchase? Often it will be looked at as business, so ideally you would have a limited company setup, with at least 3 years worth of books and a business plan for the purchased land.

If classed as domestic, they will take your house into consideration as payment insurance, as pretty much a second mortgage.

If the latter applies, the land will need to be close to your home, as fragmentation of property is considered a risk.

Whom are the typical people you'd approach for this sort of thing? NFU?
 

slowworm

Full Member
May 8, 2008
1,383
383
Devon
I think it would depend on the size of the land and what you intend to do with it. If it's a large plot and/or a normal business then speaking to a land agent may help or even an estate agent dealing with land sales.

Something more unique would require some further research and digging.

I used savings for my purchase and a previous attempt would have used funds from a mortgage on a house.
 
  • Like
Reactions: TeeDee

Broch

Full Member
Jan 18, 2009
5,607
4,980
Mid Wales
See here:

 

TeeDee

Full Member
Nov 6, 2008
8,493
2,112
47
Exeter

Key Features​

  • Current Variable Rate is 6.00%
  • We’ll consider lending up to four times joint or sole income subject to loan-to-value and an affordability assessment
  • You can borrow up to 70% of the woodlands purchase price or current value (whichever is the lower), subject to eligibility
  • An early repayment charge may be payable if you repay all or part of your mortgage within the first two years
  • Mortgages are available on a repayment basis only
  • A non-refundable mortgage application fee of £300 is payable in addition to a mortgage valuation fee
  • Our minimum loan amount is £7,000 and our maximum mortgage term is 25 years, subject to eligibility
  • Borrowers must be aged 18 or over. This mortgage is only available to UK residents
  • Our mortgages for woodland are not regulated by the Financial Conduct Authority.

Mortgages for protection and conservation Increasingly, small pockets of land and small woodlands in and around towns, cities and villages are coming under threat from either development or neglect. Ecology Building Society is dedicated to mortgage lending that protects the environment and helps to create a more sustainable future. This includes the provision of mortgage finance to enable individuals, groups or charities to purchase such land and small woods, for the protection and conservation of the environment. Features of our woodland mortgages: x You can borrow from £7,000 to £500,000 x The maximum loan to value is 70% x The term of the mortgage can be between 10 and 25 years x For interest rates – see our Current residential mortgage rates and charges leaflet x Application fee £300 x Available on a full repayment basis only see our Your mortgage leaflet x We can consider lending up to four times joint or sole income subject to loan to value. This income multiple is only intended as a guideline – our final decision on how much we can lend will be based on our overall affordability assessment x An early repayment charge is payable if you repay all or part of this mortgage within the first two years x Although insurance is not required as a condition of a mortgage on land alone, you may wish to consider taking appropriate advice on the suitability of other insurance products, such as third party liability
 

Attachments

  • mortgagesmallwoodlands.pdf
    82.8 KB · Views: 1
  • Like
Reactions: nigelp

gra_farmer

Full Member
Mar 29, 2016
989
567
Kent
Whom are the typical people you'd approach for this sort of thing? NFU?
NFU is mainly insurance. For small businesses or domestic purchases, Halifax is likely to be the best, as they take more risks than other banks. But go wherever has the best deal.

The important part is that woodland purchases need to have collateral as insurance for the purchase of woodland, work on the fact that you need to have collateral that is worth 7 times the woodland value at time of purchase, and you will have the bargaining in your favour, and don't get a loan with payback longer than 3 years. Otherwise you're paying over the odds.
 
  • Like
Reactions: TeeDee

BCUK Shop

We have a a number of knives, T-Shirts and other items for sale.

SHOP HERE