The Federal Government backed lender, Regional Investment Corporation (RIC), have launched their anticipated AgriStarter loan to assist first time farmers and support farm succession plan arrangements.
Low interest loans of up to $2 million are available to encourage and support people in obtaining their first farming business.
The loan may be used to:
- Fund the purchase of an existing farm business, land, infrastructure or other assets as part of developing a farm business
- Fund the buyout of relatives during farm business succession
- Support a new farming business by investing in infrastructure, cover operating expenses or refinance certain existing debt to improve cashflow
The terms of the loan are:
- Maximum loan of $2 million
- 10 year loan term (5 years interest only, 5 years principal and interest)
- Variable interest rate of 1.92% per annum
- No additional loan fees
- At least 50% of your total debt must stay with a commercial lender
You may be eligible for this loan if you are seeking to purchase establish or develop a farm business for the first time, or if your farm business is undertaking a succession plan. There is currently no deadline for applying however it is recommended applications be submitted early due to forecasted high demand. The key to success with applying for funding with Government bodies such as the RIC is to be on the front foot with a well prepared application which anticipates their assessment requirements in advance.
We also recommend engaging early with your bank as it imperative to run both applications at the same time as 50% of the debt will need to be secured from the Bank in addition to the RIC lending. Managing the source of funding and security arrangements for both parties is an essential part of the loan approval process which often changes as lending requirement evolve and the two parties must work together to ensure success.
At Mazars we have supported numerous clients to successfully access RIC Loan funding for their rural enterprise. The low interest rates on offer are making a real difference in their farming operations, particularly with freeing up cashflow to paydown debt or re-invest back in the farm.
For assistance in considering your suitability, in submitting your application and supporting documentation please contact your usual Mazars advisor or alternatively our Loan specialists Angela Winton or Owen Dingle on:
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