Mortgage & Loan options for 40acre property

[Brian]

Looking for some advice/feedback from some of you guys who own a little land to stretch your legs on. Wasn't sure if this should go in the DIY or preparedness forums or not, so I dropped it here. Feel free to move if appropriate.

We are looking at a property - it is about 40 acres and zoned agricultural (cattle grazing lease). There is a house on the property. Not sure if it is worth the money yet or if we'll end up doing it or not, but I started looking into financing options to run the numbers and see.

I am getting conflicting info.

First call was to the bank that holds my current mortgage. The agent was super helpful until he found out that the property was over 20 acres and zoned ag, told me I can't get a normal mortgage and needed to talk to another group (gave me another phone number). He may or may not have been right.. Called that phone number, was the ag lending group, and they say they only do commercial ag loans for a minimum of at least 60acres.
Someone suggested I talk to an independent bank local to that area. Someone else told me that a local bank would have much higher rates and probably only a 10 year window to buy out or refi (on the 30yr mortgage, you'd have to refi or pay-off in 10 years)
Have been told I should talk to USDA, but it might be 25% down instead of 20%

Anyway, I'm happy to do my own research here, but I'm curious if any of you who might be in a similar situation can at least give me an idea which direction to point - what did you do? Ag Loan? Traditional Mortgage?

[brutal]

Are you aware they could be property tax issues if you don't run the required Ag and let it fall into residential zoning? I guess if you're leasing it out for someone else's cattle to graze on you'd be ok.

I'm sure there's a lot more to it, but a friend with ag zoning has had issues maintaining the zoning without running livestock, etc. There were sme waivers granetd in years past due to drought conditions, and apparently some counties still don't have the necessary funding or staff to check and enforce zoning, but if there's a land transfer you may come under the wrath of some gubmint inspector...

[brutal]

120 acres.

He told me that if he didn't run livestock or farm they could pull the ag zoning for tax purposes and charge residential property tax rates.

Like I said, I'm sure there's more to it like leasing hay production or cattle grazing, it's just what I heard.

[brutal]

Elbert.

Like I said, I think he's getting a pass for now. He's also downsized and sold off two 40acre plots so things have changed for certain.

Just laying it out there as a consideration.

[ColoWyo]

I have a buddy who is a mortgage broker in Elbert County. I am willing to bet he is savvy to your questions. He's retired military as well and very pro-gun. So I like to support him when I can.

Let me know if you want his contact info.

[Great-Kazoo]

Or pm chunkymonkey

[asmo]

Douglas and Elbert both do the 1 cow/horse per year thing to maintain an agricultural tax rating. That basically means 1 cow for 365 days, 2 cows for 183 days, 4 cows for 92 days.... All the way to 365 cows for 1 day kinda thing. There are businesses that will 'rent' you cows for x number of days so you can maintain your agriculture tax rates.

The numbers above were for 10 acres lots, I don't know if it changes for 40+ acres.

[Holger Danske]

El Paso will pull your ag status too. Happened to my neighbor.

[TRnCO]

wife and I just bought and built new on 40 acres in Elbert. Horses don't meet the "ag" requirement unless breeding, according to my new neighbor. Our 40 was zoned ag, but once we converted from a construction loan to the conventional loan, the ag zoning tax break went away immediately, and until I get around to building fence, we won't be able to meet the ag requirement with cattle.
I guess all that to say getting a conventional loan shouldn't be an issue. It wasn't for us.

[Brian]

As for this property, we would definitely plan to continue the current arrangement with the neighboring property, who owns the cattle. Yes, eventually we'd plan on having some of our own animals, but I'm not clear what would count to maintain the tax status, so we'd start with what was easiest.