Loans vacant land
The vacant land loans are meant for people who wish to purchase a piece of land on which they intend to construct a house or a commercial building. The purchase of the vacant land varies according to the needs. A vacant land can be present in a well-developed area or a semi-developed area. However, buying vacant land can be an expensive deal depending on the area in which you are buying the land. If the area is well-developed then you would have to pay a heavy price and even if it is in a semi-developed location you would have to pay a price that cannot be afforded with savings. In such cases people often go in for vacant land loans.
These days you can easily find lenders that provide vacant land loans. let us see the features related with these loans and how can your qualify for it.
Features of vacant land loans
It is important to understand that vacant land loans are different as compared to the other type of mortgage loans. These loans are meant to purchase unimproved pieces of land. With these loans you can get an amount ranging from $5,000 to $20,000.
Usually lenders prescribe a criterion that the use of the vacant land should be categorized as either agricultural or residential. Usually the vacant land loan is not available for commercial use. Before the person applies for the vacant land loan he should confirm the facilities around the area and make sure that there is electricity water and drainage facility. Every lender has their own criteria for giving out vacant land loans. let us see these eligibility criteria.
Qualifying for the vacant land loan
For qualifying for the vacant and loan you can apply for a maximum of 10 acre parcel or up to 20 acre parcel which varies from one case to another. If you are buying a plated division then you need to provide 20% as down payment and if you are buying stand alone then you would have to provide 25% down payment amount.
When applying for a vacant land loan you should make sure that the lender gives you a lower initial rate and would demand lower monthly payments. The vacant land loans are long term loans spread over 30 years of time duration. You should make sure that the lender provides competitive interest rates along with interest rate protection.
The interest rates on vacant land loan
The interest rate for the vacant land loan varies from one lender to another. Usually it is for a fixed period with a 3/1 adjustable rate mortgage. At present the interest rate is 7.641% and if the loan is supposed to be paid off within 15 years of time then the rate is about 5.8%.
The vacant land loans are a risk to the lender because of the fact that the land is not developed and the property is not being used at present. For this reason the interest rate and the down payment on the loan is high as compared to the other mortgages. The type of vacant land loan that you require also determines the interest rate and the down payment that you are charged. If, the land is raw and you don't have a development plan then, you can find it difficult to get a loan and at low interest rates.
If you have a raw land and have plans to make improvements then you should be sure about the services that you would require to do this. The access of availability near the land has a lot of effect on the approval of the loan.
When you buy a vacant land you should make sure that you insist on title insurance and a warranty deed so that you have a clear title for the land. For tax deduction benefits on the vacant land loan payments it is advised that you take the help of a tax advisor who would be able to give you details about it.
Lenders for vacant land loans
When you apply for vacant land loans then it is important that you shop around for the right kind of loan. The interest rates vary from one lender to another hence it is important that you compare the offers from different lenders before applying for these loans.
Atlantice Loan:
They provide vacant land loans for clients who have found a piece of property but may not be ready to build for several years or, who already own a piece of vacant land and wish to refinance it. Their loan product allows the customers to buy the land at a great rate even if they are not ready to begin construction. They offer financing as high as 100%. You can fill out their online contact form for more details.
CLC:
They offer loans for purchasing or refinancing vacant land in certain states. The vacant land loan program is designed to help people secure property so that they can build a home in the near future. The vacant land loan terms depend upon location, credit, income, employment, etc. You can contact them at .
Howell:
1700 West Highland.
Suite 100.
Howell, MI 48843.
Tel: (517) 552-7235.
Fax: (517) 552-7243.
Imlay City:
301 E. First Street.
Suite 100.
Imlay City, MI 48444.
Tel: (810) 721-2400.
Fax: (810) 721-9600.
Central Macomb Community Credit Union:
They offer affordable vacant land loans to their consumers and their rates can be as low as 6.875%. You can contact them at .
Main Office.
37570 S. Gratiot.
Clinton Township, MI 48036.
Sterling Heights Office.
34642 Van Dyke Avenue.
Sterling Heights, MI 48312.
Mailing Address:
P.O. Box 2800.
Mt. Clemens, MI 48046.
Phone: 586-466-7800.
Fax: 586-468-6881.
1st National Bank:
They provide vacant land loans with just 35% down payment over a 15-year amortization. For more information you can call them at 517.545.2223.
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