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| I also think that the figure the amount of money they save on underwriting costs offsets the potential losses they will take. Thinking specifically on the dealer financing stuff they do on equipment, etc. Just pull a credit report and take a downpayment. It's worked for a long time.
I'm amazed at how much some of the input financing companies will lend without any collateral. Again, I suppose they figure the occasional loss they take is less than the amount you would spend underwriting and securing collateral. Although, I remember PHI tying me up over $7000 (even wanted checks to be co-payable) when I started farming and I had a customer that was in bad shape that owed them $200k+ and they were completely unsecured. I had gone to ag credit school with the guy running their finance program and he didn't have the first clue about farming. | |
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Future of grain prices
