LAND MORTGAGE OPTIONS ARE RARE BUT WE HAVE A FEW LOAN PROGRAMS AVAILABLE FOR LAND MORTGAGES BELOW. BORROWERS NEED TO CONSIDER A FEW FACTORS WHEN IT COMES TO LAND, AS IT IS MORE RESTRICTIVE THAT MOST OTHER LOAN TYPES.
Land Mortgage Loan Highlights
Purpose of the Land: The purpose of the land will greatly affect the type of loan and terms that are available. If the land is going to be used for recreation or hunting, for example, there may be different options available than if the land is going to be developed.
- Down Payment: Down payments for land mortgages are typically higher than for other types of mortgages. A down payment of 20% to 50% of the purchase price is not uncommon.
- Interest Rates: Interest rates for land mortgages are typically higher than for other types of mortgages, and they may be fixed or variable. The interest rate can be affected by the purpose of the land, the down payment, the credit score of the borrower, and other factors.
- Repayment Terms: The repayment terms for land mortgages can vary widely depending on the lender and the purpose of the land. Some loans may have a balloon payment due at the end of the term, while others may be fully amortized over the life of the loan.
- Zoning and Land Use Restrictions: Zoning and land use restrictions can greatly affect the value and potential use of the land. Homeowners should be aware of any restrictions before purchasing the land and taking out a mortgage.
TYPES OF LAND LOANS:
- Options for Recreation and Hunting: For those looking to purchase land for recreation or hunting purposes, there are several options available. One option is to take out a personal loan or use a home equity loan to purchase the land outright. Another option is to seek out a lender that specializes in land mortgages for recreational or hunting properties.
- Options for Developers: Developers looking to purchase land for development purposes may have different options available to them. They may be able to take out a commercial mortgage or a construction loan to purchase and develop the land. In some cases, they may also be able to partner with other investors to raise the necessary funds.
It’s important for homeowners to do their research and work with a reputable lender when considering a land mortgage. They should also consult with a real estate attorney to ensure they fully understand the terms and any legal restrictions associated with the property.
Ashley Richardson
Mortgage Loan Originator
NMLS# 2469971
Mortgage Calculator Company LLC
NMLS # 2377459
2125 BISCAYNE BLVD SUITE 220,
Miami, FL, 33137
Ari Lopez
Brokered by eXp
The Mortgage Calculator is a registered DBA of Mortgage Calculator Company LLC. NMLS ID #2377459. Programs and rates are subject to change without notice. Mortgage Calculator Company LLC is licensed in the following states that require specific licensing disclosures: AZ (#1040352), CA CFL (60DBO-171188), GA Georgia Residential Mortgage Licensee (#2377459), IL MB.6761755 Illinois Department of Financial and Professional Regulation, Division of Banking, 100 West Randolph, 9th Floor, Chicago, IL 60601 1-888-473-4858. Not licensed or conducting business in New York.
The principal and interest payment on a $400,000 30-year Fixed-Rate Loan at 7.250% and 80% loan-to-value (LTV) and 740 credit score is $2,728.71. The Annual Percentage Rate (APR) is 7.417% with estimated finance charge of $5,755. The principal and interest payments, which will continue for 360 months until paid in full, does not include taxes and home insurance premiums, which will result in a higher actual monthly payment. Rates current as of 7/9/2023. Subject to borrower approval. Disclosure: All lending products are subject to credit & property approval. Rates, program terms & conditions are subject to change without notice. Not all products are available in all states or for all amounts. Other restrictions & limitations apply.
NMLS Consumer Access Portal: https://nmlsconsumeraccess.org/EntityDetails.aspx/COMPANY/2377459
Licensing: https://themortgagecalculator.com/Page/The-Mortgage-Calculator-Licensing
