This project provides LendSecured investors with an opportunity to finance an agricultural loan secured by a first rank mortgage on half of the real estate “Līgo”, located in Rugāju parish, Balvu region for a self-employed farmer. The funding target for this project is € 10 000.00, which will be used for the purchase of another real estate.
This project gives an opportunity to make a loan with an annual rate of 11%, LTV of 51%, loan term of 24 months, with monthly manner of interest payments.
The collateral consists of 2 land plots with a total area of 22.3 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 € 20 000.00 will be registered on the collateral in the Land Register of Latvia.
The overall value of the real estate is estimated at € 39 400.00, however as the borrower owns only half of the real estate his share is estimated at € 19 700.00 subsequently making loan to collateral value ratio (LTV) – 51%.
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 € 1 300 EUR per ha to € 1 800 per ha. The average price of forest land keep increasing, on average being € 2 140 per ha.
Borrower is a self-employed farmer engaged in cattle breeding. Borrower is seeking funds to purchase additional real estate and expand his business. Borrower aims to repay the loan from incoming business revenues. Borrower is a recipient of support payments from European Agricultural Guarantee Fund and European Agricultural Fund for Rural Development.