‘Positive’ year for the loan arrangers says AMC chief

While the number of loan applications for land purchases in Scotland made to a leading mortgage company rose by 9 per cent in 2018, better returns in the dairy and potato sectors saw a spike in cash buying result in the percentage of completions drop back on the previous year’s level. Revealing the figures at the recent agents’ conference, the Agricultural Mortgage Corporation’s (AMC) also indicated that while there had been a considerable amount of refinancing of existing business, one of the biggest changes in terms of lending trends in Scotland last year was loan type – with a marked increase in the number of variable and part interest only loans being completed during the year.

The organisation, which provides long-term, fixedrate loans with no review breaks to more than 9,000 farming businesses across the UK, works closely with 19 land agents from various companies across Scotland who carry out its loan application and valuation work.

AMC’S Scotland regional agricultural managers, Dugald Hamilton and John O’meara, also addressed issues facing the sector, including the potential impact of Brexit, land prices, the amount of land which could come to the market in 2019 and lending opportunities for the year ahead.

“2018 was a positive year for loan completions, and for applications, with 57 per cent of these coming through AMC agents”, said O’meara.

“We also enjoyed a strong start to the year, which was in contrast to some of our colleagues south of the Borderwhowereimpacted by the cold and wet spring reducing appetite for capital investment.”

He said his company knew that that farmers across the country were committedtothelongterm success of their businesses, but the current uncertainty continued to be a significant factor.

“Farming businesses need to prepare for the future and structuring finances appropriately is an important part of ensuring loan repayments are affordable so that businesses can continue to grow and navigate times of uncertainty,” he added.

“It’s important to consider options for growth and discuss the viability of expansion projects to ensure you’re well positioned to evolve and succeed, whatever the future holds.”

Headquartered in Andover, AMC has worked with land-based commercial farming businesses since 1928 to support a wide range of growth and diversification initiatives, covering everything from an initial land purchase to large scale investments.