Premier Farm Credit offers a choice of two interest-bearing funds to help plan ahead for future payments and farming expenses.
An Installment Fund is associated with each mortgage loan held by our customers. The Installment Fund is an interest-bearing account for funds you want to be set aside strictly for your payment. You can invest up to 100% of the amount of your annual payment into the Installment Fund, and it will earn the same rate of interest that you are paying on the loan. Funds you deposit in the Installment Fund are automatically applied to your payment on the payment due date. Funds held in the Installment Fund are not eligible to be withdrawn once they are deposited.
A Reserve Fund is associated with both mortgage and operating loans. The Reserve Fund, sometimes called being in ‘trust’, is an interest-bearing account that can be withdrawn for farming or other expenses. Money in the Reserve Fund earns a competitive interest rate. Withdrawals are easy to complete and can be made anytime with no minimum withdrawal (or deposit) amount. Money can be transferred from the Reserve Fund into the Installment fund at any time if the Installment Fund is not at its maximum amount. You can invest up to the principal balance of your loan less any amount held in Installment in the Reserve Fund.
Frequently Asked Questions
Q: If I have an amount equal to my annual payment in the Installment Fund, what do I need to do when my payment comes due?
Nothing. On the day your payment is due, the computer automatically applies the interest credit first, then the balance of the payment is applied from the funds in the account.
Q: With the interest credit being earned, what happens to any excess funds in the Installment Fund after my payment is made?
They remain in the fund and continue to earn interest.
Q: What happens if I don’t have the full payment amount in the Installment Fund, but I have sufficient funds in the Reserve Fund?
Your payment is made from the following sources in the following order:
- Interest credit of Installment Fund
- Interest credit of Reserve Fund
- Funds from Installment Fund
- Funds from Reserve Fund
Q: If I wish to transfer funds from the reserve fund to the Installment Fund, how is this done?
Just contact your servicing office (in person or by phone) and tell them how much to transfer. A receipt will be generated showing the current balances of each fund after the transaction takes place.
Q: What is required by me if I wish to make a withdrawal from the Reserve Fund?
Simply contact your servicing office (in person or by phone) and tell them how much you would like to withdraw. A check will be issued and you will be required to sign a Withdrawal Request form.