The Rural Voice, 1986-02, Page 9should recognize that at the end of
the moratorium (on farm
foreclosures) there may be certain
aspects that he will benefit by, such
as lower interest rates or price sup-
ports . but the guy has to
realistically assess his own situa-
tion and if it is going to require a
very large or dramatic change in
the financial environment, that
just isn't likely to happen."
"A problem in
agriculture is that the
farm family allows
personal emotions to
govern too large an
extent of the
decision-making
function."
Nor should a client expect
Kingsmount, which acts as a kind
of middleman, to arrange a write-
down of debt either with banks,
Farm Credit, or other creditors.
"We frequently arrange set-
tlements with lending institutions,
and these settlements are on the
basis that if the bank or lending in-
stitution involved were to accept
the terms of our proposal (and
usually it would involve a cash
payment), their realization on their
collateral would probably be as
good if not better than if they for-
cibly liquidated the guy. Therefore
we expect that they would accept a
settlement offer that is that way
and give our clients a full release of
any shortfall they might have."
Phillips says that he's come to
appreciate the farmers' special at-
tachment to the land, but at the
same time he and his staff must
look at a client's farming opera-
tion from an objective business
point -of -view. He often tells
farmers that it's better to cash in
their chips while they still have
substantial equity and can start a
new life, perhaps someday going
back into farming when the in-
dustry again becomes profitable.
"A problem in agriculture is that
the farm family allows personal
emotions to govern too large an ex-
tent of the decision-making func-
tion."
Nor should a farmer feel that
he's a failure if he has to liquidate
his operation under current condi-
tions. "They (farmers) were coerc-
ed into borrowing money and ex-
panding their operation and their
timing was wrong," says Phillips.
"If they'd done it ten years earlier
they would be wealthy today."
After the farm analysis is com-
plete, the farmer or farm couple
are called back to the Kingsmount
offices and presented with their
alternatives, everything from do-
ing nothing "until the bank comes
and takes it away from you" to
coming up with a plan of action to
approach the creditors with.
"We feel you get a much better
ear from your creditors if you take
the initiative and go to them," says
Phillips. Clients are advised to li-
quidate either when they still have
enought equity to start a new life
or, conversely, when they have a
net worth, in Phillips' words, of
"minus zero." When that's the
case, says Phillips, the farmer
often has the strongest position in
any negotiations because if he were
to just walk away, the lender's
predicament would worsen, par-
ticularly when livestock are involv-
ed.
"Usually we're successful in let-
ting the guy get out with a certain
amount of dignity," says Phillips.
Very few Kingsmount clients have
ever been put in the position of
having to declare personal
bankruptcy, which Phillips calls
"an unnecessary indignity." But
once a client has made the difficult
decision to liquidate, "then the
time to do it is right then and there,
okay, not stringing it out so it
becomes agonizing."
Usually a liquidation takes from
three to six months, depending on
the season and whether the farm is
a livestock operation. Kingsmount
staff will attend meetings with
creditors on the client's behalf,
and in some cases they also work
closely with the Ontario Ministry
of Agriculture and Food's finan-
cial consultants in Toronto.
Ron Phillips says that Kings -
mount has been successful in
negotiating settlements with
lenders for about 70 per cent of the
firm's cases. Also, about 10 per
cent of Kingsmount's 800 files are
farmers who are still in "sound
BECKERS
FARM
EQUIPMENT
SNOWBLOWERS
New 86" North Am. DA $ 1,875
84" Lucknow SA $ 1,195
Used 60" G.W. SA $ 795
Used 84" McKee SA $ 875
Used 84" Lucknow $ 875
USED TILLAGE
Triple K 171/2' cult $ 1,750
Triple K 91/2' cult $ 600
Triple K 11' cult $ 650
IH 350 disc, 10' $ 1,250
J.D. 145 plow 4x16 $ 1,850
IH 710 plow 5x18 $ 3,250
Ford 151 plow 5x16 $ 3,750
USED PLANTERS
& DRILLS
IH 400 4 r. adj. fert.
insect $ 2,500
IH 564 r. fert. insect $ 1,450
IH 10 comb. drill 16x7 $ 2,250
IH 510 comb. drill 16x7 $ 3,750
TRACTORS
IH B414 G c/w loader $ 2,950
IH 434 G p.s $ 4,350
IH 454 D flat fenders $ 5,450
IH 574 D T.A $ 6,950
IH 574 D flat fenders $ 6,500
IH 656 D hydro $ 5,650
IH 784 D T.A. low hrs. POA
IH 966 D cab $ 9,500
IH 1066 D cab $ 9,500
IH 1086 D MFD $23,500
IH 1486 D cab, air
clean $21,500
IH 5088 D 895 hrs $37,500
Case IH 2294 D
360 hrs 837,500
V.L. BECKER & SONS LTD.
Hwy 83 Dashwood
519-237-3242
519.237-3673
Evg. 519-237-3653 (Bill)
519-236-4784 (Ralph)
519-238-5445 (Bob)
FEBRUARY 1986 7