Recreational Land Loan: Anyone done this before?

So, I am going to go look at 35 acres that I think I might be pretty serious about getting. I want a place 2 is hours away where we can get to in a weekend and do camping.

I found a place I think I like ($45K), and rather than writing a check and ALL of my savings be drained, I think I want to explore financing it and paying it off quickly. While keeping my savings and rainy day fund where it is. I have great credit and the means to pay/sizeable down payment so that will not be a problem.

Anyone financed raw land before? Recommend a company?

Last time I looked into it, my local credit union had the best rates and most trouble free process. I'd start there.

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Originally Posted by XC700116

Last time I looked into it, my local credit union had the best rates and most trouble free process. I'd start there.

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I don't have a Local bank and my current bank is no help. I may have to join one.

My finance lady said to try a bank or credit union that is local to the area you are purchasing.

Join one.

Easier with a construction loan. But definitely doable with a good down and debt to income.

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Originally Posted by davsel

My finance lady said to try a bank or credit union that is local to the area you are purchasing.

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^ This. I ran into a similar situation in the past. A local bank or lender will know the in's and out's of financing property in the local area.

Is the land in question accessible, or does it require right of way ? If purchased where is water and power?

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Originally Posted by Great-Kazoo

Is the land in question accessible, or does it require right of way ? If purchased where is water and power?

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No water (except for seasonal dry creek) and power I am going to find out when I visit how far away it is. Land is accessible from opposite sides via nice gravel road.

I am in the middle of a land loan (for 10 acres) right now.. I have a banker that has been really good to work with. Let me know if you want his name.

That said - every bank/broker I spoke with said that land loans are the ones they have the most trouble with. For lots over 20 acres its going to be darn near impossible to find a lender in CO that will let you borrow without 60% (yes 60%) down (I have a whole long list of brokers/banks/credit unions that I tried). I know of a person outside of CO that will do it for 20% down but he is a little bit flakey. Most all of them are doing 3/1 or 5/1 on lots. Most everyone said to just do a 3/1 construction loan and then refi it under any equity you have in your existing home (if any). Its easier for them to write a construction loan than a lot loan. A couple of the banks I talked to said they were getting out of the land loans all toghether and are either selling off the notes or strongly enouraging their existing borrowers to sell. On more than one occasion I had the broker at a bank/CU offer to send me a list of lots they had and wanted to get rid of.

One thing that I found odd was even on lots where you have no intention to build several of the lenders still want soil and percolation tests done.

Glad I saw this thread....wife and I are looking at property now for a build. Obviously different with a construction loan but I'm still trying to work out the best way to go about getting that done.

Always had good dealings with these Guys.

Premier Members FCU
https://www.pmfcu.org/

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Originally Posted by rbeau30

No water (except for seasonal dry creek) and power I am going to find out when I visit how far away it is. Land is accessible from opposite sides via nice gravel road.

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Are those road[s] public or right of way access ? Unless you have direct access, walk away. Paying / buying off someone els,e to get on to your property can be a real PITA / legal hassle.

We found a place in the 80's outside indian hills, priced right with operating well. Only issue was you have to traverse 25yds over someone else property. Sales said the owner was more then willing to allow access. He didn't say or clarify how many vehicles, time of day or how long access would be granted.

Never done it myself, but my dad has bought and sold more farms than I care to detail almost all through credit unions local to the property. The only exceptions were seller financed. Not sure who the current owner is, but good 'ol boys will usually sign that deal in a heartbeat.

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Originally Posted by Great-Kazoo

Are those road[s] public or right of way access ? Unless you have direct access, walk away. Paying / buying off someone els,e to get on to your property can be a real PITA / legal hassle.

We found a place in the 80's outside indian hills, priced right with operating well. Only issue was you have to traverse 25yds over someone else property. Sales said the owner was more then willing to allow access. He didn't say or clarify how many vehicles, time of day or how long access would be granted.

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Some may have an established ROW and some will have a casual easement. Plat maps will show existing ROWs and if they are still viable.

In the Plat Map the legend shows that both roads are either: State highway, Platted Subdivision road, or County road.

If there is no power/water to the land, no banks/credit unions would loan on it. If there is power/water, then its max 50% etc.

That being said, I would look into a bridge loan to develop the land then go with USDA loan.

The county assessor's office will have plat maps. Just give them the property ID number.

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Originally Posted by rbeau30

Land is accessible from opposite sides via nice gravel road.

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There are two access roads? Do they cross neighbor's land?

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Originally Posted by Ah Pook

The county assessor's office will have plat maps. Just give them the property ID number.


There are two access roads? Do they cross neighbor's land?

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No there is one going east/west north of the property, and one going east/west on the south, they both come from a numbered county road.

I've been out of the real estate game for a while but the reason banks hesitate to loan on vacant land is that it's easy to walk away from vacant land if you get into financial trouble. If you live in a house on a some land, you are more likely to stay and find a way to make your payments.

I had a VERY hard time as a realtor finding lenders who would work with vacant land unless it was a construction loan. That was 10 years ago, but I can only imagine that it's even harder now. Maybe I'm wrong though.

Eh, Maybe I'll just have to pay outright if everything on the land checks out.

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Originally Posted by GilpinGuy

I've been out of the real estate game for a while but the reason banks hesitate to loan on vacant land is that it's easy to walk away from vacant land if you get into financial trouble. If you live in a house on a some land, you are more likely to stay and find a way to make your payments.

I had a VERY hard time as a realtor finding lenders who would work with vacant land unless it was a construction loan. That was 10 years ago, but I can only imagine that it's even harder now. Maybe I'm wrong though.

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Harder now.

Unless you plan on develop it right away, I dont recommend anyone buy acreage. Next time you take a drive on an county road, notice the '100 acre for sale' sign that has been sitting there for years and years.

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Originally Posted by rbeau30

Eh, Maybe I'll just have to pay outright if everything on the land checks out.

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Drop an 8x8 tuff shed on the property, throw an expired propane tank next to it and call it a Hunting Guide office. get a P.O. box and call it livable.
If homeless people can use the speer overpass as a legit residence, so can you.

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Originally Posted by Great-Kazoo

Drop an 8x8 tuff shed on the property, throw an expired propane tank next to it and call it a Hunting Guide office. get a P.O. box and call it livable.
If homeless people can use the speer overpass as a legit residence, so can you.

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:-D there already is a wooden shed on it. expired propane tank got one of those.

be careful with land that has even a shed on it. we have seen several land deals go bad because of even a small 1880s shack on it somewhere. local bank or credit union is your best bet.

As said, it is probably not a great investment and will be harder to sell, but that being said even i am looking at 35 acres or so for myself, have not decided whether it will be in Co or not