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How much is the typical down payment for purchasing land?

by chasingdreams.sal... from Lincoln, Nebraska. Jan 7th 2014 Reply


Barb Lanis (BarbLanis)
#70 ranked lender in Illinois - 663 contributions

It depends on your plans for the property. Will you be building soon? Do you need construction funds? More info please.

Jan 7th 2014
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Brian Taylor (gmcapital)
#38 ranked lender in Connecticut - 4 contributions

The down payment requirement for land can range from 35% to 50% or more. It all depends on whether the land is improved, in a highly desired area. Generally, land is the highest risk asset of the least interest to lenders. Depending on your intended use for the land you can work the land into a development loan, if of course the intent is to improve upon the land. You are more than welcome to email me directly if you wish to discuss your question further. btaylor@gmcloans.com Thank you for your post.

Jan 7th 2014
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Joe Metzler (JoeMetzler)
#1 ranked lender in Minnesota - 3,875 contributions

Raw law? For most people, at least 20%...

Jan 8th 2014
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Phil Dumouchel (PhilDu)
#32 ranked lender in South Carolina - 2,237 contributions

Usually 20-30% or more and the financing terms are usually more strict. If it is a building lot you plan to build on in a couple years, check with local banks and/or credit unions. Good luck

Jan 8th 2014
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Kevin Stillman (kbstillman)
#17 ranked lender in Iowa - 69 contributions

If you want to build a home on an improved residential lot and you are going to wait to build for a few years, most lenders will usually want at least 20% down. If you have equity in an existing home you can usually get a home equity loan to cover the down payment on the land purchase. If you are buying more land than a residential lot (e.g., acreage) then the down payment can jump to at least 30% and the terms can become very strict. If you shop around you will likely hear that it "depends on the land and your financial situation" because many lenders (local banks) will look at a lot of information (e.g., income, credit, liquid assets, etc.) to make a loan decision. Land loans are typically structured to be short-term loans originated directly by the lender and do not have to comply with more stringent secondary market guidelines. If you have more questions you can call me at 515.333.2171. All the best to you!

Jan 8th 2014
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Jason Vondrak (jvondrak)
#217 ranked lender in California - 1,741 contributions

At least 20 percent, often more for land.

Jan 8th 2014
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William J Acres (William_Acres)
#1 ranked lender in Arizona - 8,588 contributions

Unlike purchasing a single family home, land loans do not have a conforming set of guidelines.. each lender offering financing for land has their own set of rules and requirements different from each other.. so there is no typical amount necessary.. some local credit unions have done 100% loans for lifetime customers, and I've seen other lenders require 50% down, and everything in between.. even when you look at all the responses here you will see a varying percentage.. It's best you check with a few of your local banks and credit unions and see what their requirements would be.. .. I'm a Broker here in Scottsdale AZ and I only lend in Arizona. If you or someone you know is looking for financing options, feel free to contact me or pass along my information. William J. Acres, Lender411's number ONE lender in Arizona. 480-287-5714 WilliamAcres.com

Jan 8th 2014
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