Payment plans on young horses

[_Tradewind]

Forgive me if this has been discussed before.

We recently received an email inquiring about one of our weanlings, asking if we would accept payment plans. We have not sold a horse on payments before, and asked the prospective buyer what they were proposing.

The response was that “big breeders” often will offer payment plans on youngsters of “1 or 2 years”, with the buyer paying “a little bit” of board (assuming they are on outdoor board).

I can’t imagine anyone accepting this type (length) of payment plan - has anyone had experience with payment plans, either of this duration or of any kind? What is the “norm”?

[BeeHoney]

I can’t speak for the “big breeders” out there, but I have never sold young horses on payment plans. I have sold young horses (total purchase price paid at time of sale) and then continued to board them (with a proper boarding contract) at a fair boarding price for a period of time. I have also sold horses to people who have paid the purchase price with money borrowed from a lending institution. There are so many reasonable options for people to borrow money these days that I can’t help it, I kind of raise an eyebrow whenever anyone asks for a payment plan. This may not be fair, but it makes me feel like the person either must have a very poor financial situation to not have access to some form of credit–or they consciously or unconsciously want to leave a door open to back out of a deal.

[ElementFarm]

I once purchased a young horse on a payment plan. I bought him at 1-week old. I paid 25% at that time, and made 6 installments on a monthly basis. Board was free till he was weaned, and once he was weaned and paid off, I moved him closer to home. If I’d walked away at any time, I wouldn’t have gotten a cent back, and breeder had money coming in every month, and a sale of the nice colt. So it was a win-win. I would never ask for a payment plan of more than 6-8 months, and of course the horse would stay with the breeder, and I would pay board and expenses for that time.
I’m just starting to dabble in my own breeding program, and if someone wanted to make payments, I absolutely would consider that, with a very good contract.

[MysticOakRanch]

I’ve sold on payment plans - with foals, as described by Element, free board until 6 months old, then I charge reasonable pasture board after that. Never payments for 1 to 2 years, but up to 6 months. My contract states that if they don’t complete the payments, they forfeit payments to date and ownership doesn’t transfer until the horse is paid in full. Contract also states they are responsible for all care costs, including vet care. They also sign a boarding contract.

I’ve sold 2 or 3 horses over the years this way, and never had any issues. I also know of a few (pretty high end) trainers who have purchased this way too. Most can afford on-going care, insurance, etc - it is coming up with that $8k or $10k or more to buy a nice young horse that is difficult.

I would never go out beyond one year though.

I don’t think it is unusual - but if you are not comfortable with it, most definitely don’t do it!

[TrotTrotPumpkn]

I bought a riding horse with half down and the rest over six months. I paid full board obviously. If the horse had died I still owed the rest, so insurance was important. In my case he went lame and I still owed the rest. sigh

I wouldn’t be comfortable on a weanling going longer. An in-utero, yes.

The seller and I knew each other.

[VirginiaBred]

I’ve sold on payment plans, for myself and for client horses I’ve had on the farm. Works great!

[BetterOffRed]

[QUOTE=ElementFarm;8546262]
I once purchased a young horse on a payment plan. I bought him at 1-week old. I paid 25% at that time, and made 6 installments on a monthly basis. Board was free till he was weaned, and once he was weaned and paid off, I moved him closer to home. If I’d walked away at any time, I wouldn’t have gotten a cent back, and breeder had money coming in every month, and a sale of the nice colt. So it was a win-win. I would never ask for a payment plan of more than 6-8 months, and of course the horse would stay with the breeder, and I would pay board and expenses for that time.
I’m just starting to dabble in my own breeding program, and if someone wanted to make payments, I absolutely would consider that, with a very good contract.[/QUOTE]

I had a similar payment plan.- contract detailed deposit plus regular payments. No board until the horse was paid off. I was purchasing a 9mo old. During the payment process, I was responsible for mandatory insurance on the horse, for all medical expenses incurred including regular vet visits; farrier. I kept the horse there for an additional year after the horse was paid off so I just paid for board and regular vet/farrier stuff.

My breeder vetted me very carefully though. LOL. she called the people I was training with and boarded and made sure I was what I said I was.

I’ve developed a great relationship with my horse’s breeder and have become very good friends that has lasted longer than the purchase process. Its a relationship that I value and treasure and because of that would recommend my breeders to anyone.

[MuskokaLakesConnemaras]

I have offered short term payment plans. Works fine as the animal doesn’t leave till its paid for.

[Forte]

I sold a horse on payment plans once, and I would never ever do it again in a million years. It was a nightmare. The horse in question was a very high quality imported broodmare who was in foal to a highly regarded stallion via frozen semen. She also had a foal by her side (who was mine and not part of the deal). I though it would be ok do payment plans since the mare couldn’t leave anyways until her current foal was weaned. The buyer was purchasing sight unseen. The problem started right away. The buyer wasn’t happy with how the mare looked in photos (as a middle aged lactating broodmare with a large hungry filly at her side, no she didn’t look as fat and glossy as she did when she was a four year old at her inspection. The buyer was not a breeder. ). She wanted to abort the unborn foal because she didn’t want a Sir Donnerhall baby and preferred a Totilas (seriously, who aborts a Sir Donnerhall for no reason?? The mare was several months along and it was too late to rebreed that year anyways). I told her that once the mare was paid for in full, it was up to her whether she wanted to abort the unborn foal, but since she hadn’t actually paid for the mare yet, she was not permitted to abort the pregnancy. She kept insisting, so finally I just gave her the money she paid back and cancelled the sale. This was after her threatening to sue me several times.

Really, if the buyer can’t afford to pay for the horse in full, are they going to be able to afford to look after it if something goes wrong? I just wouldn’t do it again. If someone wants to do payment plans now I suggest that they save their money and if the horse is still available once they’ve saved up the required money, they can but the horse at that time.

[sixpoundfarm]

Forte that sounds absolutely awful! I’m sorry you had to deal with that.

I would consider short term payment plans with a non refundable deposit and insurance on the horse/foal. On foals, board & handling until 6 mos is inclusive with the purchase price, much like Element Farm described.
When we have more room to offer field board, I can see doing it for clients at a reasonable amount to cover costs and labor, guess would need to know what ‘a little bit’ of board means.

[fordtraktor]

As a buyer I would consider it for an in utero just because paying part before and part when the foal is successfully born makes sense to me.

Otherwise I prefer just to keep it simple and pay at once, with this and all horse sales. I have kept babies with breeders for a period of time before so they could be raised with other babies as I tend to just buy one baby at a time. I have paid basically field board prices for field board once weaned. Though I have a weanling now I just brought home and put out with an older babysitter mare and gelding and she’s doing great.

[NoDQhere]

I think payment plans can work fine, especially on youngsters. We have done a few and all has worked out well. Just make sure everyone is clear about everything.

[Nootka]

[QUOTE=Forte;8547088]
I sold a horse on payment plans once, and I would never ever do it again in a million years. It was a nightmare. The horse in question was a very high quality imported broodmare who was in foal to a highly regarded stallion via frozen semen. She also had a foal by her side (who was mine and not part of the deal). I though it would be ok do payment plans since the mare couldn’t leave anyways until her current foal was weaned. The buyer was purchasing sight unseen. The problem started right away. The buyer wasn’t happy with how the mare looked in photos (as a middle aged lactating broodmare with a large hungry filly at her side, no she didn’t look as fat and glossy as she did when she was a four year old at her inspection. The buyer was not a breeder. ). She wanted to abort the unborn foal because she didn’t want a Sir Donnerhall baby and preferred a Totilas (seriously, who aborts a Sir Donnerhall for no reason?? The mare was several months along and it was too late to rebreed that year anyways). I told her that once the mare was paid for in full, it was up to her whether she wanted to abort the unborn foal, but since she hadn’t actually paid for the mare yet, she was not permitted to abort the pregnancy. She kept insisting, so finally I just gave her the money she paid back and cancelled the sale. This was after her threatening to sue me several times.

Really, if the buyer can’t afford to pay for the horse in full, are they going to be able to afford to look after it if something goes wrong? I just wouldn’t do it again. If someone wants to do payment plans now I suggest that they save their money and if the horse is still available once they’ve saved up the required money, they can but the horse at that time.[/QUOTE]

I am sorry you had this experience… that is FREAKING insane!!

I have purchased 2 this way. One was in Germany (weanling then imported as a yearling) and the other here in the states (yearlingish with a 1yr payment plan. I pay reasonable board and make payments. I also will pay vet care. I sent a few extra bucks during inspection for the time and effort). 100% you have to get insurance on said horse. I haven’t had any problems and everyone seems happy

[MysticOakRanch]

[QUOTE=sixpoundfarm;8547952]
, I can see doing it for clients at a reasonable amount to cover costs and labor, guess would need to know what ‘a little bit’ of board means. ;)[/QUOTE]

I don’t mind sharing that info…Of course, board rates vary quite a bit by area - I’m in Cali where board is high and pasture board is rare. I charge $250/month for pasture board which includes 3 flakes of hay (about 20 pounds), ration balancer, and msm (all my young horses get it). That includes holding for farrier and routine vet work, and of course, all the horses are checked every day. Can’t say it makes me a lot of money (since I’m always re-investing in fencing and I pay someone to clean the pastures, scrub the water troughs, etc every week). That is $100 off my regular pasture board ($350) for horses that weren’t purchased from me.

If it is going to be long term and they want the horse handled regularly (taken out, put in trailer, groomed, etc at least 3 days/week on top of the daily checks), it is another $100/month.

Of course, that rate might vary if you were in a less expensive area - we pay $15 or more for a bale of hay, and land is expensive so pasture board is hard to find. Especially with safe fencing, shelters, etc. And lightly rolling hills, not straight up and down and not pancake flat;)

I know of a couple of other places that all do similar deals in my area - pasture board is generally between $250 and $400. You CAN find cheaper pasture board, but with barb wire or hog wire fencing - and I wouldn’t risk my nice young horse on that kind of fencing! I get a few outside youngsters just about every year - some stay for a few months while owners are out of country, some stay until they are 3 and ready to start.

Not sure if that helps? A place up the road use to do a similar deal - we often referred people back and forth depending on their specific needs.

Personally, I enjoy seeing them grow up here, so it is worth it to me to give that kind of rate - but I have the land. I know some breeders are lacking space and really need the young horses to move on each year.

[_Tradewind]

For those of you who have sold on payment plans, what does your contract stipulate in case of late payments?

Does the buyer have a grace period? Do you charge interest? Is it assumed that beyond a certain point they have defaulted?

In the event that the buyer defaults, is it stated that they will lose what they have paid to date?

Do you insist that buyers have insurance on the horse, if it remains in your care until paid off, or is that their risk/decision?

[EquusMagnificus]

Late payment incur fees or even, when excessive, can lead to cancelling the sale.

I don’t charge interest, but I do charge full board (outdoor or indoor, depending on buyer’s choice).

If buyer defaults, they lose every sum already paid.

I didn’t insist on insurance, but I have suggested it.

Finally, horse doesn’t leave property until paid in full.

[Daventry]

We’ve done a few payment plans in the past, mostly with weanlings. Buyer received reduced board and finishes paying over a few months. I would definitely not let it go more than 6 months…as you can open up a huge can of worms that way. I require the buyer purchase insurance that has both of us named on the policy while the horse remains on our property. Two payment plans went totally south due to really crazy buyers and have been the worst two buyers I’ve ever dealt with. The others were great to deal with and everything went smoothly.

Regardless of the terms, please, please make sure you do NOT let your horse leave the property until paid for in full and also make sure you have a great contract, that both parties sign, with EVERYTHING spelled out.

I wrote an article a few years ago that explains some of the lesser known facts when selling on payments. Really important information to keep in mind when deciding to venture down this path! www.equineappraisers.com/sellingonpayments.html

[SportArab]

I’ve both bought and sold with payment plans. The deal has always been that the papers don’t transfer until the final payment is received by the seller. Free board on babies up to 6 months. After that, the standard board. Like any other transaction done over time, there should be clearly stated charges for lateness.