• 1. 220 acres of tillable land, purchase price of $5,200 per acre
  • Appraised value of the land equates to $5,800 per acre
  • Acceptable Loan to Value of 60%.
  • Down payment = _______
• 2.
• • Machinery and Equipment valuation on the balance sheet = $2,400,000.
  • John Deere Baler Picker loan with an outstanding balance of $750,000 that is financed with the local equipment dealer.
  • You plan to buy out your parents ownership interest in the farming operation, which equates to $1,650,000. You plan to use your equity in the machinery and equipment to finance the purchase.
  • Your lender excludes all equipment with an existing lien on it from their loan to value calculations. Assuming a loan to value of 75% for machinery and equipment, what is the maximum amount your bank will loan you towards the buy out? _________