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Re: Trying to justify Buying more ground. [Re: Providence Farm] #7030368
10/28/20 12:47 PM
10/28/20 12:47 PM
Joined: Jan 2017
Posts: 2,523
Ks
Flint Hill fur Offline
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Ks
Sell some deer hunts an wine an dine them in the cabin an that'd sure help with payments.

Re: Trying to justify Buying more ground. [Re: Providence Farm] #7030369
10/28/20 12:50 PM
10/28/20 12:50 PM
Joined: Sep 2011
Posts: 1,019
N E Nebraska
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sotired Online content
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N E Nebraska
I would buy the land.


"Education, transportation, and communication, that's what ruined the world."
Re: Trying to justify Buying more ground. [Re: Providence Farm] #7030373
10/28/20 12:51 PM
10/28/20 12:51 PM
Joined: May 2011
Posts: 1,283
Kansas
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Kansas Cat Offline
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Kansas
I don't think you will regret buying it. Interests rates are low. If the property is truly worth $1000 more per acre than it is currently valued at, it is a no brainer. One thing to keep in mind, it is a lot easier to buy land than it is to pay for land. Another thing to keep in mind is that land prices can decrease.

Re: Trying to justify Buying more ground. [Re: Providence Farm] #7030377
10/28/20 12:57 PM
10/28/20 12:57 PM
Joined: Dec 2007
Posts: 634
minnesota
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minnesota
If you can swing it-buy it....you will regret it later if you pass. I have passed on a few that I will never forgive myself for. But I have also bought the ones I really wanted the most and will never regret that!!! None of my purchases were for investment-they are all going to the kids. Hunting land.

Re: Trying to justify Buying more ground. [Re: Providence Farm] #7030382
10/28/20 01:05 PM
10/28/20 01:05 PM
Joined: Mar 2010
Posts: 2,584
wyoming southeast
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danvee Offline
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Well consider your age and liability this is the first thing I would do. Interest rates are very low now which is good. Can the land pay for itself by farming it or by other means. You say if Biden wins the election you will loose your job. That could be a big consideration but it might be waiting till after the election and see what really does occur with you job. I always consider worst case scenarios when putting out a lot of cash for something be it land or equipment and consider how things would work out.

Re: Trying to justify Buying more ground. [Re: Providence Farm] #7030384
10/28/20 01:08 PM
10/28/20 01:08 PM
Joined: Dec 2013
Posts: 12,570
Greene County,Virginia
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Greene County,Virginia
Buy it.


wanna be goat farmer.
Re: Trying to justify Buying more ground. [Re: Providence Farm] #7030475
10/28/20 03:54 PM
10/28/20 03:54 PM
Joined: Oct 2020
Posts: 995
IL
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IL
do you have the cash to buy it?

Re: Trying to justify Buying more ground. [Re: Providence Farm] #7030482
10/28/20 04:02 PM
10/28/20 04:02 PM
Joined: Oct 2020
Posts: 995
IL
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Originally Posted by Providence Farm
Originally Posted by Bob
I would not buy it. Spreading oneself too thin with debt is a recipe for disaster. Sounds like you could probably squeak by making the payments month to month, but that first little curveball life throws you will knock down all your best laid plans like dominoes. Pretty soon itís snowballed to the point youíre having to look at bankruptcy.

Good rule of thumb is to spend no more than 25% of your take home pay on your home/land.



Sound advice. Here is some background
I'm 40 years old and owe 20k on one morgage my in laws are living in and paying the payment. Other than that I'm debt free.

This summer I spent out of 20k out of savings on farm improvements. That was before I missed 1.5 months of work due to covid quarantine, my daughters accident and my old car became destined for the junk yard.

I also am putting in 1900' of water lines on the farm by December.

So my savings is very low currently.

I just bought another cheap transportation truck a 97 ranger with 52k for 3200 cash. Yuck 2wd but cheap and will hopefully last.

I dont like debt.

Payments on a 20 year 100k= 33 acres of it roughly will be just under 600$ a month. I
I Can cash out 20 k from my 401 pay off that morgage and turn that into 400 a month and use that property for collateral for the down payment. Making my payments the equivalent of ,$200 a month or less than a days pay per month.

That makes it easy to buy even more of the ground. As stated it always going up in value and they are not making any more. Add in that it borders my place and probably won't be for sale again in my lifetime at least that I can afford makes me really to buy as much as I can.
If it were advertised it would sell quickly and easily probably for at least 1 k more per acre if for nothin more than from some big money deer hunters.


The penalties and taxes on cashing out your 401k will kill you. Bad idea.

Three consequences of a 401(k) early withdrawal or cashing out a 401(k)
Taxes will be withheld. The IRS generally requires automatic withholding of 20% of a 401(k) early withdrawal for taxes. So if you withdraw $10,000 from your 401(k) at age 40, you may get only about $8,000. Keep in mind that you might get some of this back in the form of a tax refund at tax time if your withholding exceeds your actual tax liability.

The IRS will penalize you. If you withdraw money from your 401(k) before youíre 59Ĺ, the IRS usually assesses a 10% penalty when you file your tax return. That could mean giving the government $1,000 of that $10,000 withdrawal. Between the taxes and penalty, your immediate take-home total could be as low as $7,000 from your original $10,000.

It may mean less money for your future. That may be especially true if the market is down when you make the early withdrawal. ďIf you're pulling funds out, it can severely impact your ability to participate in a rebound, and then your entire retirement plan is offset,Ē says Adam Harding, a certified financial planner in Scottsdale, Arizona.



Last edited by ILcooner; 10/28/20 04:03 PM.
Re: Trying to justify Buying more ground. [Re: Providence Farm] #7030505
10/28/20 04:56 PM
10/28/20 04:56 PM
Joined: Feb 2020
Posts: 4,644
Indiana
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Providence Farm Offline OP
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Indiana

It wouldn't be an instantaneous closing of my plant it takes time for legislation to make it through. It's just highly likely that they would pass a lot of laws that would end up closing our power plant and smelter . Thats speculation on my part of course . But looking ahead the writing is on the wall with the Democrats.

That said I'm nearly debt free so an added 600- 1200 a month off set by 400 income from the other property seems easy to make. Also I will see if they offer insurance that pays off the loan or at least makes the payments if I lose my job or become disabled .

Bob I don't see it as stealing from my retirement rather having a secure solid asset of the house and property that's pays about 9% return. I will have that 20 l back in 5 years and double it in 10 and still have a property I can sell for around 70k. I dont see how I can get hurt. Vs leaving it in the market that will most likely crash and take several years to recover. I see it as a stable investment like gold but with a better return. What am I missing


Then taking that income to off set the expense of buying an additional asset for bare land cost that has water electricity and 2 livable building for improvement. Those would cost over 20k to run and install going from what I was quoted from the power company and the water lines I am currently running. If course that's depends on how we devide it between each other. The structure really raise taxes and requires upkeep that will be expensive.

Also logging it could severely off set the expense.

It's a once in a lifetime chance to get it at this price. Without the neighbor I wouldn't consider it.

I'm going ts see if it comes together and if the neighbor and I are on the same page on where and how to split it. We will see. Maybe nothing will come together in that case I will just keep build up what we have and be grateful to God blessings that are so numerous i cant count them and I often am guilty of taking for granted.

It will take some time with the owner has agreed to give us before listing it at a much higher price.

If anyone really sees where I'm over looking something please let kknow.i understand wher Bob is coming from and could well be missing something.

Re: Trying to justify Buying more ground. [Re: Bob] #7030581
10/28/20 06:07 PM
10/28/20 06:07 PM
Joined: Mar 2018
Posts: 1,074
NC
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NC
Originally Posted by Bob
Originally Posted by Tailhunter
Nobody ever says, ďI sure am glad I didnít buy that land 20-30-40 years agoĒ.


Sure they do, when they have to file bankruptcy and lose the land as well as the equity because they were over leveraged to begin with.

All the math in the financial world concerning debt leaves out one factor, the biggest factor, which is risk. If your income stops from illness, or something expensive happens to you that you have to pay for, sometimes both at once, then you are screwed. The math works when itís just math but life happens.

I definitely would not cash out retirement funds to buy it. Donít steal from your future to find your now.


Youíre right, never take a chance because some body once somewhere did it wrong.

Iíve seen land out preform retirement funds many times.

Last edited by Tailhunter; 10/28/20 06:07 PM.
Re: Trying to justify Buying more ground. [Re: Providence Farm] #7030585
10/28/20 06:09 PM
10/28/20 06:09 PM
Joined: Aug 2008
Posts: 13,459
ny
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Well,,,its the only thing they cant make more of ! smile


the wheels of the gods turn very slowly
Re: Trying to justify Buying more ground. [Re: Providence Farm] #7030650
10/28/20 06:59 PM
10/28/20 06:59 PM
Joined: Dec 2014
Posts: 204
Arizona
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Arizona
Interest rates are low, but only for houses. Interest rates on raw land is probably double if you can even get a bank interested in loaning. I know you said there were houses, but keep that in mind when you and your neighbor decide to split the land. I would definitely buy it.

Last edited by Starbits; 10/28/20 07:00 PM.
Re: Trying to justify Buying more ground. [Re: Providence Farm] #7030687
10/28/20 07:26 PM
10/28/20 07:26 PM
Joined: Mar 2013
Posts: 1,733
chelsea,wi
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buy it and get those houses rented out to pay for it all


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Re: Trying to justify Buying more ground. [Re: keets] #7030705
10/28/20 07:38 PM
10/28/20 07:38 PM
Joined: Jan 2018
Posts: 3,157
MN
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Donnersurvivor Offline
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MN
Originally Posted by keets
buy it and get those houses rented out to pay for it all

Agreed. If I could find a house to rent for say 600 a month + expenses in the middle of nowhere and the landlord never bothered me or complained about my trucks and trailers I would jump all over that. The last place I rented I did all sorts of work to just to fix it up, never asked them for anything I just did it, lots of people like me looking for a place that is cheap where they can be left alone for the most part, quality of the house is largely irrelevant to someone like that.

Re: Trying to justify Buying more ground. [Re: Providence Farm] #7030778
10/28/20 08:23 PM
10/28/20 08:23 PM
Joined: Jan 2014
Posts: 1,700
NW MO
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TurkeyTime Offline
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NW MO
Like the others.... If you can swing it buy it. My Grandpa always said know one ever regrets buying land. I should have 90 and 40 acres on two sides that I was too reluctant to buy. Could of, would of, should of.

Re: Trying to justify Buying more ground. [Re: Providence Farm] #7030946
10/28/20 10:31 PM
10/28/20 10:31 PM
Joined: Sep 2007
Posts: 3,662
Near Alexandria, MN
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Why not rent out the house? Either hire a property manager or do it yourself, it's pretty darn simple if you learn the basic tenant screening procedures.

Option two is to buy it, rehab the house and subdivide it into a couple acre parcel. At that point you could sell the house and keep the land with a lower LTV.

Re: Trying to justify Buying more ground. [Re: Providence Farm] #7031048
10/29/20 01:02 AM
10/29/20 01:02 AM
Joined: Feb 2020
Posts: 4,644
Indiana
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Providence Farm Offline OP
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Indiana
Probably won't happen realistically. The neighbor showed no desire for the houses and tax burden only the land this weekend. Today they want the houses. This didnt sit well with my wife so unless there is a substantial off set on price per Acer ve assets of the houses I'm out.

As far as interest rates on raw land it's under 4% with 25% down through farm credit services. With money down and good credit it's easy. I will probably go to get per approved tomorrow just incase but I'm not holding my breath at this point. I'd probably be ahead to spend the cash on what I have and concentrate on profit instead of more land that will be an expense. After all if it goes from double what I paid (current) to 4x I may sell out and head west.

Coming together with other parties was a long shot to begin with. Business with friends never mixes well and I prefer to keep the friends. Wife was discharged said if I want it get it but you know how it is when a woman gets an idea in her head and it gets changed. Happy wife and life type jazz.We will see what happens.


Last edited by Providence Farm; 10/29/20 01:19 AM.
Re: Trying to justify Buying more ground. [Re: Providence Farm] #7031174
10/29/20 07:25 AM
10/29/20 07:25 AM
Joined: Dec 2017
Posts: 5,439
Kansas
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Kansas
With interest rates so low itís a great time to buy if land is priced right. Weíve bought 1000!in the last six months because prices have dropped a bit. Our rule is if itís close or adjoins buy it. The few times we have broken this rule we have regretted it. Run the numbers and most importantly pray about it. I always ask for the Lord to take away any emotions I have and to give me clarity on decisions like this. Good luck and let us know your decision


Everything the left touches it destroys
Re: Trying to justify Buying more ground. [Re: Providence Farm] #7031243
10/29/20 08:12 AM
10/29/20 08:12 AM
Joined: Jan 2018
Posts: 3,157
MN
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MN
The thing you don't hear about when taking loans to buy land is how hard the financial stress can be on a marriage. Women already typically have so much aniexty and for twenty years of payments they have one more thing to worry about.

There is a freedom and peace that comes with being debt and obligation free, maybe just enjoy that feeling and try not to hold any regrets if you can't/don't buy it

Re: Trying to justify Buying more ground. [Re: Donnersurvivor] #7032827
10/30/20 06:23 PM
10/30/20 06:23 PM
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Posts: 4,644
Indiana
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Providence Farm Offline OP
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Want to move to Indiana?;) I even know a guy that's pretty handy with ropes, rigging, chain saws, and big equipment.

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