Financing land

[Shannonbeth]

Okay, so we are obviously looking at land but no intentions of doing anything with it till we can get into the class. I just had a question. If we found what we were looking for at a price we liked what kind of loan would we want to purchase the land while we save up money to get to the class and for materials to build our home. Since we have no intentions of building any time in the near future what loan would we go with?

LOT LAND LOANS
Lot Land Loans are designed as purchase money loans for those borrowers who aren’t ready to begin construction at this time, and as such are not ready to obtain a construction loan, but will be ready in the near future. The lot must be normal for the area and at least one utility must be available from the street. (Septic tanks or propane tanks are acceptable if these features are normal for the neighborhood.)

LAND PURCHASE LOANS
A Land Purchase Loan can provide the funding you need to purchase the ideal land to build your dream home! It can help you pay for land before you start building on it. Depending on your needs, you can choose to fully amortize your payments, or pay interest only for the majority of the term, to keep your payments lower.

[ChainsawGrandpa]

If there is any way possible, I would like to discourage you from getting a loan on land.

* It's a buyers paradise on land. We are no where near the bottom yet.

*I never found good deals on land until after I took the class. I can't explain that. Maybe the class gave me a new way of thinking... I don't know. My first piece of land after the class was (about) $747. Yes, that's the total cost, yes, it was very, very nice, and yes, it was fee simple. I know of several pieces of land right now that are fantastic deals. Just wait, the prices will get much better. I know of a piece of land right now that is about $12,000, and it is very nice.

*"Never catch a falling knife." There's a lot of wisdom in those words. The market is falling and yes, you will get cut. Wait 'till the prices are on the floor before you decide to pick up a (knife) piece of real estate.

*When I took the class there were ways to get land cheap, or even free. That was then. The opportunities are much better now.

Forget about spending $200,000 for 80 acres of old growth trees, and four season streams of glacier pure water. That dream property could be yours for assuming the payments, managing the property, or a short sale.

The prices are going down. Don't buy this year at foreclosure. Wait until next year and buy at a tax sale.

Save, save, save, and don't buy anything until after the class, and it is best to pay cash, or do a trade, and it shouldn't take too much cash.

Todays good deal on that dream property may be tomorrow's nightmare. Don't pressure yourself into a piece of land.

Once in a lifetime deals happen every other day if you're looking for them. Just be patient and wait.


G'pa

[edkemper]

I'd like to disagree with one thing. CASH. When you have money in your pocket the deals seem to come out of the woodwork.

[ChainsawGrandpa]

That's true.
When you have cash people can smell it and they come a lookin' to make you a great deal on their land.

G'pa

[hammerhead 67]

If you cant afford the land, the build, or the class, you aren't ready to buy.

Save up and take the class. It will open your eyes to a world of possibilities as Gpa suggests.

You will learn WHAT to buy, and HOW to buy from the people on the members side.

Its really more of a mind set than a technique really. Once you get your brain wrapped around working with cash, buying super cheap, and building a beautiful quality home for a fraction of retail, you will start to "discover" sweet deals on land. Then you will be ready for the next step.... MAKING a great deal.

Most great deals are not found, they are made through solving other peoples problems while satisfying your needs at the same time.

[rreidnauer]

I know it's hard for some folks to come up with cash, but I gotta say, when you REALLY want to build up cash, it's amazing how quick one can seem to come up with it. (by cutting other expenses) I had to come up with 7k for my land in a little over a month. I opened a line of credit at my bank because I didn't think I could pull it off, but I did with an extra $500 to spare. Mind you, I put myself on a financial crash diet, but I was able to pull it off.

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[loghousenut]

Talk about a pile of GREAT advice! They are all sssoooooooo right.

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[Shannonbeth]

I have some money saved and I will continue saving for the class. Thanks for all your advice, I will just wait on land.

[LogLover]

Hi Shannon - long time no see or talk. Glad you still out there.
Lots of sound advice above but I think much may also depend on locale and markets. If you are still looking in general area(s) closer in to the TC's what I've been seeing is the prices have stabilized and starting that dang creep back up and have been for last year. Outside the "radius" we talked about before --- they continue to fall a bit. A good friend bought 60 acres near Watertown with older farm buildings and house for $92K this past week. The seller had paid $375K in 2005. OUCH.
Seems there remains a load of $$$$$ in the hands of those that want to build close in and the demand is rising again.....location locastion location.

Show me the lot I want and I'd be hard pressed to pass on it if it's w/i 30 miles of the west side of metro anyway. It's probably not getting any cheaper as it was loooooow 3 years back.
That said - if you can stretch that radius and willing to wait I bet the days ahead will see lower prices. That magical mythical willing to drive daily to work thing is big mental block for many in metro.
Land contracts starting to become more the norm again - I sure wouldn't hestitate to buy if all fits your dream .... AND budget.
BTW - How is that family of yours? Hope the storms been staying to south of you. Good to see you back!

[Shannonbeth]

You make a valid point too LogLover. I have been watching land prices for over a year now and in the TC area as well as other areas around there they do seem to have stabilized and some have creeped back up. I only want 5 to 10 acres, I am not looking to farm so no need for more than that.

My family is good, pregnant with baby number 7 so you can see why I am considering financing the land and having it paid off before we build. LOL.

I hope all is well on your end as well.