Financing Your Tractor
Farming is one of the most important industries around, but it isn’t a cheap one to stay in. You need the right tools and machines on hand, like tractors, and it can be difficult to stretch your budget to ensure you’ve got all the necessary equipment. We here at Mike Cooper Tractors want to help you get what you need at the prices you want, so we’ve put together a brief guide to financing your tractor purchase, below. To learn more, or to see the tractors we have for sale, contact our store in Fort Gibson, Oklahoma, today!
1: Set a Budget
It’s easy to get attached to a fancy, brand-new model with all sorts of bells and whistles, but they’re also pricey. It’s important to set a budget before you even start your tractor hunt so you don’t fall in love with a tractor you end up unable to afford. First, take a look at the price ranges for the specific type of tractor you’re looking at to get a feel for the sticker prices. Next, shop around the various loans available so you can account for likely interest rates.
The budget itself will need to account for three things. First, you’ll need a down payment between 10-20% of the sticker price up front, so ensure you have the funds for that. Next, you’ll be making monthly installments to pay off the rest of the balance, plus interest. Finally, remember to factor in fuel, regular and emergency maintenance, accessories, and implements.
2: The Loan
There are two main types of loans you’ll be able to qualify for. The first is a secured loan, which is relatively easy to obtain. They have lower interest rates, higher overall amounts, and longer repayment terms, and you won’t need as high a credit score. However, they use the tractor as collateral, meaning that defaulting on a payment could lead to repossession.
The other type is an unsecured loan. They have shorter repayment terms, higher interest rates, and lower overall amounts, and they require a fairly high credit score. However, they don’t need the tractor as collateral. Defaulting on the loan should still be a last resort, but it won’t necessarily lead to repossession.
3: The Lender
You can get your loan from a number of different sources. Banks and credit unions are popular options, with credit unions having more favorable terms and amounts. If you’re a member of the financial institution you’re getting the loan from, that will also work in your favor. Another option is to get a loan from a dealership, which is a service we here at Mike Cooper Tractors provide!
Whether you want to talk about a loan or just need some financing advice, feel free to contact our financing department to speak to our experts. We proudly serve the people of Tulsa and Muskogee, Oklahoma—let us serve you today!