TYPE OF PROPERTY | Type of | Lender |
| ↓ | CONVENTIONAL | FARM | PORTFOLIO | | Backyard Barn | Y | N | Y | | Horse Facility | Y | S | Y | | Gentleman Farm | S | S | Y | | Agricultural Farm | N | Y | S | Vacant Land | S | S | Y |
Y - Yes, N - No, S - Sometimes. The table above gives you a general idea as to which type of lender to contact for the type of property you are interestedin purchasing.
CONVENTIONAL LENDER: A conventional lender includes most mortgage companies, mortgage brokers and banks who sell their mortgages on the secondary market. The majority of these loans use Federal National Mortgage Association (Fannie Mae) guidelines. Review them here. A few of these lenders work with other investors, as well who may be a bit more lenient about property type in exchange for a higher interest rate. Sometimes they will lend on: Gentleman Farms - depends on comparable sales available and the property's acreage. Land - a few do have land loan programs.
FARM LENDER: These lenders are very specfic in the type of property they will finance. There are a limited number of farm lenders, with most having some involvement with the USDA. Sometimes they will lend on: Horse Facilites - when a business is involved. Business history and/or business plan usually required; downpayments are usually larger. Gentleman Farms - if income is being produced. Land - if being developed agriculturally.
PORTFOLIO LENDER: Portfolio lenders make up a majority of the loans for properties that do not qualify according to Fannie Mae guidelines. These lenders are made up of the local banks with employees that live and work right here in New Hampshire. They see the value of land and understand that there is a sought-after rural way of life here in our state. These banks have lending criteria, as well, but it is based on the bank's lending policies, not someone else's. NH BANKS
As a sidebar when pursuing financing: To lend on property in New Hampshire, the financial institution must be licensed to do businss in New Hampshire. If you are using an internet-based lender, be sure to ask up front if they are licensed to do business here. |
challenge. Unfortunately, most conventional lenders do not see the value in the things WE FIND VERY IMPORTANT in our "farm" property. Things like oversized barns whether for horses, cows or other livestock, indoor riding arenas, and permanent fencing are superfluous items to many lenders. Large parcels of land is another potential stumbling block when financing property due to limitations placed on the lenders by the secondary mortgage market.
