Short version of a long story... My brother and I are in our early 30's late 20's... When our father passed away in 2000 the small farm (480 acres) went to us. My mother inherited 160 acres across the road from her family in 2003. Ever since then we have operated the 640 acres as one business-lets call it CCK Farms LLC. The profits went into CCK's bank account and whatever it made was divided by the 640 acres and split according based on how much you owned of the ground (mom got 160 acres worth brother and I got 240 acres worth each). We share crop the farm ground with a neighbor and cash rent the pasture-so income isn't the same every year.
Three years ago together we put equal down payments down (1/3rd each) on another 160 acres. Now we pay the loan first, then whatever is left is split equally like we had done in the past. All three of us have jobs outside of farming, I am very interested in growing the farm, the other two's interest is tepid at best.
I feel our operation is somewhat unique in the fact that we can break even every year and that's okay. So my goal is to continue buying land at a rate that keeps us breaking even until I decide to go back and farm full time. The wife and I are willing to put our savings towards new land down-payments that's not an issue the other two don't want to... But if I personally bought another 160 acres I would like to use the entire 800 acres profitability to pay off the loans, this maximizes my ability to buy more land. But that would be screwing my mother and brother because they are paying off my land loan. So how can I buy more land and use all the land's income to pay off the bills?
Option 1. Put the down payment for the ground up 100% myself, but purchase the land in everyone's name (or maybe the LLC's name?). The LLC pays the land loan each year & in years money is left over its starts to pay me back as well for 2/3rds of the down payment. I run the check book so getting paid won't be an issue.
So far that's the only idea I have that accomplishes all of the goals, anybody have an other ideas or knows how someone did something similar? For those who want to comment I'm an idiot for wanting to farm/loan money with family, yeah I know the risk i'm not concerned it being an issue in this family as long as the plan is fair- but coming up with a plant that is fair to everyone is proving difficult, so I'm reaching out for help.
Three years ago together we put equal down payments down (1/3rd each) on another 160 acres. Now we pay the loan first, then whatever is left is split equally like we had done in the past. All three of us have jobs outside of farming, I am very interested in growing the farm, the other two's interest is tepid at best.
I feel our operation is somewhat unique in the fact that we can break even every year and that's okay. So my goal is to continue buying land at a rate that keeps us breaking even until I decide to go back and farm full time. The wife and I are willing to put our savings towards new land down-payments that's not an issue the other two don't want to... But if I personally bought another 160 acres I would like to use the entire 800 acres profitability to pay off the loans, this maximizes my ability to buy more land. But that would be screwing my mother and brother because they are paying off my land loan. So how can I buy more land and use all the land's income to pay off the bills?
Option 1. Put the down payment for the ground up 100% myself, but purchase the land in everyone's name (or maybe the LLC's name?). The LLC pays the land loan each year & in years money is left over its starts to pay me back as well for 2/3rds of the down payment. I run the check book so getting paid won't be an issue.
So far that's the only idea I have that accomplishes all of the goals, anybody have an other ideas or knows how someone did something similar? For those who want to comment I'm an idiot for wanting to farm/loan money with family, yeah I know the risk i'm not concerned it being an issue in this family as long as the plan is fair- but coming up with a plant that is fair to everyone is proving difficult, so I'm reaching out for help.