Most Illinois farmland is not owned by farmers • Hacker News Board

Re: Most Illinois farmland is not owned by farmers

#211

Post by potato3732842 » Thu, Jul 31, 2025, 12:30 AM UTC

toomuchtodo wrote: post #208

potato3732842 wrote: post #207

Earlier quoted context omitted.

You're being pedantic. Land not occupied by some money making asset also being financed or used as collateral in the deal cannot be financed at rates that are not the lending equivalent of a "we really don't want this job so we're bidding high".

This is simply not true based on the interest rates and underwriting guidelines, and I own raw ag land that has been financed with nothing else besides a down payment and the land as collateral. Words mean things my dude. These are not hard money rates, these are credit products specifically for land with no business, cash flow, or other income stream at time of transfer. Being ignorant or unsophisticated is a choice…

"Ag" is the keyword there and I suspect it roughtly translates to "somehow tax subsidized by the rest of us". Go try and get a loan on residential/industrial or otherwise non-ag land and get back to me. Everyone looks (i.e. does their due diligence) and nobody ever goes for it because the rates or terms are always laughable.

Since you're an expert link poster why don't you cherry pick us all up some of those underwriting guidelines you cite?

I look forward to learning about ag specific loan products.

Re: Most Illinois farmland is not owned by farmers

#212

Post by toomuchtodo » Thu, Jul 31, 2025, 12:33 AM UTC

potato3732842 wrote: post #211

toomuchtodo wrote: post #208

Earlier quoted context omitted.

This is simply not true based on the interest rates and underwriting guidelines, and I own raw ag land that has been financed with nothing else besides a down payment and the land as collateral. Words mean things my dude. These are not hard money rates, these are credit products specifically for land with no business, cash flow, or other income stream at time of transfer. Being ignorant or unsophisticated is a choice…

"Ag" is the keyword there and I suspect it roughtly translates to "somehow tax subsidized by the rest of us". Go try and get a loan on residential/industrial or otherwise non-ag land and get back to me. Everyone looks (i.e. does their due diligence) and nobody ever goes for it because the rates or terms are always laughable. Since you're an expert link poster why don't you cherry pick us all up some of those underwri…

I can have a wholesale originator (UWM) extend me credit for those use cases in ~15 minutes up to almost $1M at 7% (conforming, ready for sale into the ABS market), which is very reasonable imho. I can get up to $5M within a few days if it’s commercial through one of the commercial banks I work with (Wintrust). 80% LTV, most of the time.

Guidelines are openly available at Fannie Mae, Freddie Mac, and USDA websites (unless there are specific overlays a bank is using, which is typically proprietary).

Re: Most Illinois farmland is not owned by farmers

#213

Post by potato3732842 » Thu, Jul 31, 2025, 12:36 AM UTC

toomuchtodo wrote: post #212

potato3732842 wrote: post #211

Earlier quoted context omitted.

"Ag" is the keyword there and I suspect it roughtly translates to "somehow tax subsidized by the rest of us". Go try and get a loan on residential/industrial or otherwise non-ag land and get back to me. Everyone looks (i.e. does their due diligence) and nobody ever goes for it because the rates or terms are always laughable. Since you're an expert link poster why don't you cherry pick us all up some of those underwri…

I can have a wholesale originator (UWM) extend me credit for those use cases in ~15 minutes up to almost $1M at 7% (conforming, ready for sale into the ABS market), which is very reasonable imho. I can get up to $5M within a few days if it’s commercial through one of the commercial banks I work with (Wintrust). 80% LTV, most of the time. Guidelines are openly available at Fannie Mae, Freddie Mac, and USDA websites (u…

What does "conforming" mean here? Because I suspect there will be a reference in there that is a pointer to something involving government subsidy. Everything ag related is rife with that.

Re: Most Illinois farmland is not owned by farmers

#214

Post by 9rx » Thu, Jul 31, 2025, 12:38 AM UTC

arbor_day wrote: post #173

9rx wrote: post #102

Earlier quoted context omitted.

> You need ~$1M worth of equipment to farm 80 acres All new? That seems way too low. You'd struggle to get into a combine alone. Used? That seems way too high. I doubt I'd get any more than $300k for my equipment (and that's more than I paid) if I were to sell it today, and it's pretty nice equipment compared to what I see a lot of farmers using. > 80 acres (~$1M worth of land) We always wonder why so cheap? The 18 a…

1M was a nice round number for equipment. I see people without much land buy new equipment all the time, it’s wild! They tend to not stick around long though. You must have better land than we do. Land by me goes for around 14K/ acre. The bigger plots or better land goes higher.

> You must have better land than we do.

It's decent enough, but hardly the best ever known. 200-220bu corn and 50-60bu soybeans would be pretty typical for good ground. Whereas, as I understand it, that is merely average ground in Illinois?

But the farmers are really hungry. Case in point: When I was a kid there were eight adjacent farms, including where I grew up, that all had farmers living on them. Of their kids (my generation), there are now 12 of us trying to farm in the same area. That's a 50% increase! As you can imagine, the competition is fierce.

Re: Most Illinois farmland is not owned by farmers

#215

Post by toomuchtodo » Thu, Jul 31, 2025, 12:38 AM UTC

potato3732842 wrote: post #213

toomuchtodo wrote: post #212

Earlier quoted context omitted.

I can have a wholesale originator (UWM) extend me credit for those use cases in ~15 minutes up to almost $1M at 7% (conforming, ready for sale into the ABS market), which is very reasonable imho. I can get up to $5M within a few days if it’s commercial through one of the commercial banks I work with (Wintrust). 80% LTV, most of the time. Guidelines are openly available at Fannie Mae, Freddie Mac, and USDA websites (u…

What does "conforming" mean here? Because I suspect there will be a reference in there that is a pointer to something involving government subsidy. Everything ag related is rife with that.

https://en.wikipedia.org/wiki/Conforming_loan

I love government subsidies through implicit and explicit loan guarantees. It’s the reason a 30 year mortgage exists. It’s the reason one can default on an FHA mortgage with almost no consequences (while being almost impossible to default on student loan debt).

To your point this is “subsidized by the rest of us,” the bottom 50% of American earners only pay 2.3% of total federal income tax collected, with the top 50% paying the rest. The poor folks are not on the hook for subsidies when they come out of general federal gov revenue (FHA loans charge an upfront and monthly mortgage insurance premium, and there are similar costs for USDA and VA loans but lesser so; we can consider those costs “cost recovery” for the purpose of evaluating self funded vs subsidies via transfer from the general fund).

https://taxfoundation.org/data/all/federal/latest-federal-in...

Re: Most Illinois farmland is not owned by farmers

#216

Post by potato3732842 » Thu, Jul 31, 2025, 12:38 AM UTC

darth_avocado wrote: post #48

xnx wrote: post #32

Farming is somehow still regarded as being some mom-and-pop heartland thing rather than the highly optimized manufacturing operation it has been for decades. Direct farm employment is now just 1.2% of the population. It was 40% in 1900. The special treatments farms and farmers get is an outdated relic kept alive by the electoral college.

It’s because it’s still mom and pop because 72% of farms are still fully owned by people but they tend to be smaller in size and only account for 30% of the total farm land. And majority of farms are still under a 1000 acre size. The problem is that there are about 27000 farms that are hyper giants of 5000+ acres which are the consolidated operations that account for a huge portion of the US farmland. Also, farming i…

We should be talking in terms of dollars, not land. It won't change things enough to change the point but it'll probably be worth a few percent.

Re: Most Illinois farmland is not owned by farmers

#217

Post by potato3732842 » Thu, Jul 31, 2025, 12:42 AM UTC

TulliusCicero wrote: post #52

quantummagic wrote: post #43

Earlier quoted context omitted.

The country wouldn't even exist without the electoral college. It was pivotal in uniting the states under a federal government, and is working as intended. Maybe the USA should be abandoned, and all ties between the states renegotiated, but you shouldn't be able to unilaterally change the terms of the deal.

It was necessary at the time yes, it's just drastically outlived its usefulness.

Electoral college is a red herring.

Direct election of senators has been way worse for the country. You need something that represents the states as entities.

Re: Most Illinois farmland is not owned by farmers

#218

Post by jjtheblunt » Thu, Jul 31, 2025, 12:51 AM UTC

appreciatorBus wrote: post #88

libraryofbabel wrote: post #82

Earlier quoted context omitted.

> Farming is a terrible business. My few hundred acres (maybe worth $5M) will only churn out a few hundred grand in profit -- not even better than holding t-bills. Non-judgmental curious question: why do you keep doing it? (As opposed to selling the land and buying tbills.)

> the ick that comes with running other businesses Also non-judgmental curious question: what is this "ick" related to non-farming businesses?

I'm from Illinois at the edge of farmland, which rotates corn and soy.

I therefore wondered if it refers to this, a disease of corn...or if it was just a coincidental use of the word.

https://www.nature.com/articles/srep43818.pdf?error=cookies_...

Re: Most Illinois farmland is not owned by farmers

#219

Post by moate » Thu, Jul 31, 2025, 12:53 AM UTC

potato3732842 wrote: post #202

appreciatorBus wrote: post #88

Earlier quoted context omitted.

> the ick that comes with running other businesses Also non-judgmental curious question: what is this "ick" related to non-farming businesses?

[flagged]

I think "insular rural folk" are often literate enough to see highfalutin dick-bags like yourself coming and don't want to be associated with that level of disdainful pretense.

I work in project management for a massive multi-national, about as "businessy business" as you can get, and my moon-shining, hog-raising cousins give me shit for being a sellout (we grew up showing and milking cows together) but we all still can sense a vibe about "certain types from the big city" that's more about respect and shared culture that any sort of financial, social, political, or other illiteracy/incompetence.

Re: Most Illinois farmland is not owned by farmers

#220

Post by RandomBacon » Thu, Jul 31, 2025, 1:00 AM UTC

jdhzzz wrote: post #201

toast0 wrote: post #143

Earlier quoted context omitted.

> It’s a no brainer if you have a couple thousand dollars to spare for an estate lawyer to do some estate planning and spare your heirs probate court. What I keep hearing from experienced estate attorneys is that California probate court is onerous and worth a lot of effort to avoid, but other state's have reasonable probate; it might still be worth it to avoid probate, but it's not such a big deal. OTOH, dealing wit…

I'm in CT and was told one of the big advantages of a trust is speed. It can take 10-12 months to clear probate while the trust goes the the beneficiary(ies) more or less immediately.

My interest in having a property/home in a trust is privacy. Where I live, tax records are easily searchable online, so you can easily find out where someone lives assuming they don't have a very common name, or are renting. And if someone is curious about a specific property, most people are going to stop at 123 Elm St Trust.