This project provides LendSecured investors with an opportunity to finance an agricultural loan secured by a first rank mortgage on the real estate “Straupnieki”, located in Straupes parish, Cēsu region for Cēsu rajona Straupes pagasta zemnieku saimniecība "STRAUPNIEKI", registration No. 44101025061. The funding target for this project is € 77 000.00, which will be used in order to refinance existing business liabilities and purchase of machinery.
This project gives an opportunity to make a loan with an annual rate of 12%, LTV of 56%, loan term of 12 months, with repayment of accrued interest and principal at the end of the loan term.
The collateral consists of two land plots with a total area of 51.8 ha, consisting both of agricultural and forest land. In order to secure the claims, arising out of loan agreements, a first-hand mortgage in the amount of € 154 000,00 will be registered on the collateral in the Land Register of Latvia.
The current market value of the collateral is estimated at € 137 200 subsequently making loan to collateral value ratio (LTV) - 56%.
The demand for agricultural land currently in Latvia exceeds supply and 25% of farmers are forced to rent the land, as there is none available on the market. The price of agricultural land plots in the parish of the collateral ranges from € 1 750 EUR per ha to € 2 600 per ha. The average price of forest land (regardless of the value of the felling area) is € 1 200 per ha.
Borrower has been operating since 1997 and is engaged in mixed farming. Borrower aims to repay the loan from incoming business revenues. For additional guarantee the owner of the farm is giving a surety-ship in the full loan amount.The borrower is a recipient of support payments from European Agricultural Guarantee Fund and European Agricultural Fund for Rural Development.