This project provides LendSecured investors with an opportunity to finance an agricultural loan secured by a first rank mortgage on the real estate “Rāpšas”, located in Suntažu parish, Ogres region for Zemnieku saimniecība “RĀPŠAS”, registration No.47404005472. The funding target for this project is € 9 000.00, which will be used in order to purchase trailer.
This project gives an opportunity to make a loan with an annual rate of 11%, LTV of 34%, loan term of 24 months, with monthly manner of interest and principal payments.
The collateral consists of an agricultural land plot with a total area of 10.19 ha and the buildings on it. In order to secure the claims, arising out of loan agreements, a first-hand mortgage in the amount of € 18 000,00 will be registered on the collateral in the Land Register of Latvia.
The current market value of the collateral is estimated at € 26 400 subsequently making loan to collateral value ratio (LTV) - 34%. Even upon a forced sale, estimating that the real estate will be sold for 30% lower than the market value (€ 18 480), LTV will not exceed 50%.
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 € 2 900 EUR per ha to € 3 400 per ha.
Borrower has been operating since 1992 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.