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Diversification Loan Guarantees (DLG)
"Venture not all in one bottom." - anonymous
It is likely one of the world's oldest phrases; the term 'bottom' refers to the practice of 'bottomry' - when the master of a Babylonian ship borrowed money on the ship's 'bottom' (or 'keel'), so as to forfeit the ship to the creditor if the money wasn't paid upon the ship's return. Of course, the loan couldn't be paid if the ship sank en route.
The phrase has been modified throughout the centuries (including "Don't venture all your eggs in one basket" and Mark Twain's colorful, ironic twist: "Put all your eggs in the one basket - and watch that basket"), but the sentiment remains: it is unwise to rely too much one one resource or one line of effort. This is especially true in agriculture, where markets for specific products can fluctuate greatly from year to year, and it is highly advantageous to diversify production.
MASC's Diversification Loan Guarantee (DLG) program assists with the diversification, innovative and value-added activities of farmers by guaranteeing funds borrowed from participating commercial lenders. The program can also be used to finance the purchase of equity shares in New Generation Cooperatives.
- Eligibility
- Details
- Contact
- Links
Eligibility
Eligible Applicants
The DLG program is available to individuals, partnerships, limited partnerships, corporations, and cooperatives.
To qualify as an individual, you must:
- be 18 years of age or older
- operate a farm or agricultural enterprise
- reside in Manitoba as a Canadian citizen (or as a lawfully admitted permanent resident of Canada)
Qualified partnerships, limited partnerships, corporations and cooperatives must:
- have a majority interest held by individuals who meet the individual requirements (as above)
- incorporated or registered in Manitoba and conduct business (or intend to) in Manitoba
Eligible applicants for the DLG program must demonstrate a satisfactory marketing strategy, acceptable cash-flow and long-term profitability based on a business plan to service the debt. In addition, management of the project must demonstrate the ability, experience, expertise, knowledge and capacity to successfully run the operation.
Eligible DLG Projects
Projects considered eligible for the DLG program must comply with laws concerning the environment, and any buildings or improvements associated with the project must comply with land use control laws.
Loans that are not guaranteed by the DLG program include operating loans, loans for the purchase of feeder livestock and loans for the purchase of dwellings.
Details
Loan Maximum
The maximum loan guarantee is not capped, and encourages the establishment or further development of larger scale projects, such as those involving processing or in some way adding value to raw production.
MASC provides a {guarantee}% of the principal amount of loans approved by a participating lender under this program.
Interest Rate
If a variable rate is selected, the interest rate ceiling is at the individual's lender's prime rate plus {program_details::variable_add}%. If a fixed rate is selected, the rate is set at the lender's residential mortgage rate plus {program_details::fixed_add}%.
Repayment
Loan payments can be made semi-annually or more frequently.
Contact
Loan applications should first be made by the client to the lender of their choice. The lender then applies to MASC's Morris office for the loan guarantee.
Manager, Loan Guarantees Manitoba Agricultural Services Corporation 229 Main St. S., Box 100 Morris, Manitoba, R0G 1K0 Tel: (204) 746-7509 |
Related MASC Links |
External Links |
