10Terms of Agribusiness Natural Disaster Loans

10 Terms of Agribusiness Natural Disaster Loans

(1) Subject to the requirements in subsections (2) and (3), the Corporation may set the terms and conditions upon which a loan is made. Requirements regarding terms of loan (2) The requirements are that: (a) the amount of the loan does not exceed $5 million; and (b) the duration of the loan is 10 years; and (c) the farm business may, at any time before the amount becomes due and payable, repay the whole or part of an amount of principal or interest owing on the loan without penalty; and (d) the farm business must provide sufficient security for the loan. Requirements regarding principal and interest (3) The requirements are that: (a) for the first 2 years of the loan—no interest is payable; and (b) for the remaining 8 years of the loan—interest is payable; and (c) for the first 5 years of the loan—no principal is payable; and (d) for the remaining 5 years of the loan—principal is payable.

Note: Part 2 of the Regional Investment Corporation Operating Mandate Direction 2018 deals with the interest rates applying to the loan.

Types of security the Corporation must consider (5) For the purposes of paragraph (2)(d), the Corporation must consider requiring security in the form of: (a) a registered mortgage over land; or (b) a registered mortgage over livestock; or (c) a registered security interest in water rights.