Land Loans Made Easy
What is a Land Loan?
A land loan is a type of loan specifically designed to finance the purchase of a plot of land, often referred to as a lot loan. It allows individuals to buy land with plans to build on it in the future. Unlike a traditional mortgage, which is used to finance a house and the land it sits on, a land loan focuses solely on the land itself.
Key aspects of land loans:
Purpose: Primarily used to buy land, with or without plans to build immediately.
Collateral: The land itself serves as collateral for the loan.
Higher Risk: Land loans are generally considered riskier than traditional mortgages, as there's no immediate home to secure the loan.
Terms: Land loans have higher interest rates, larger down payments, and shorter loan terms compared to traditional mortgages.
Construction Loans: Some land loans can also be combined with construction loans, allowing borrowers to finance both the land and the construction of a new home in a single loan.
What is the difference between Construction Loans and Land Loans?
With a construction loan, you can purchase the land with a construction loan, you just need to have plans and specs and a contract with a builder already in place. A construction loan is used primarily to build a home. Whereas a land loan is used to purchase land if you are not ready to start the building process. A land loan gives you the flexibility to get your plans and specs and a builder nailed down.
Can I use a Construction Loan to Purchase Land?
Yes. A construction loan does afford you the opportunity to purchase the land with a construction loan. You will need to have your plans, specs and a contract with a builder before you put in an offer on a piece of land.
Secure the Land of Your Future - Right Here in Alabama.
If you are dreaming of building a new home, we can make it easy to finance your next dream home with flexible land loan options tailored to your goals.
Why Choose Us for Your Land Loan?
Get Started Today
Securing land in Alabama is easier than you think. Whether it’s 1 acre or 20, we’re here to help you finance your future.
Speak with a Loan Specialist today! 256-542-1516
Even though I am located in Huntsville, AL, service Alabama, Tennessee, Florida, Georgia, South Carolina, North Carolina, Virginia, Colorado and Texas.