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Central IL | I know for a fact that our local bank called loans on smaller farms that had never missed a payment during the 80's. Had some larger farms that were in trouble and the regulators were leaning on the bank to build their reserves, so they called the loans on some smaller farmers they knew had the collateral to pay them off. Most were fortunate enough to find financing elsewhere, but at higher rates, worse terms, and maximum stress levels. Read the fine print on your loan docs and you will see that banks do not need a reason to call the loans. What prevents it usually is the damage to their reputation in their local market, but if the **** hits the fan hard enough, they will cover their own backsides first. The big companies that borrow 100's of millions have corporate lawyers that even the playing field when negotiating loan terms. Most farmers and small business's not so much. | |
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Banks calling in Ag loans ?
