How to Buy Land Without Getting a Loan
Buying land without obtaining a loan may seem impractical, but it is viable if you are willing to put forth time and effort to research and plan your purchase. There are a few different strategies that can be used to buy land without a mortgage, each of which has its own pros and cons.
Cash Purchases
One of the most common ways to buy land without getting a loan is to save money dedicated to your purchase to pay for the land outright. This can take time, but it is an attainable goal for those who are willing to be patient and disciplined with their savings. To save up for a land purchase, you will need to set a budget that is maintainable. Cutting out unnecessary expenses and putting any extra money you have towards your land fund can be helpful in preserving every last penny. The process can be slow, but this is a simple yet effective way to pay for land with your own money.
To make this process easier, it can be helpful to set a specific savings goal for your land purchase. Finding the price of the acreage or the average price of a few areas you are interested in is a good starting point. For example, if you know that the land you want to buy is going to cost $10,000, you can set a goal to save $1,000 per month for the next 10 months. This makes the target goal clear and will motivate you to work towards it effectively.
In addition to setting a savings goal, it can also be helpful to create a plan for how you will save up the money to pay for your land. You may want to consider setting up a separate savings account specifically for your land fund, automatically transferring a certain amount of money into this account each month. This helps to ensure that you are consistently saving towards your land purchase while also making it easier to track your progress.
Consider Discounted Land
Another option for buying land without getting a loan is to look for land that is being sold at a discount or at a price that is below market value. This can be a great way to get a good deal on your land purchase while saving money in the process. To find land that is being sold at a markdown, you can look for land that is being sold as part of an estate sale, or land that is being sold by the government or a private owner who is motivated to sell.
Finding land at a lower price can be commenced by checking with your local government to discover if there is any land for sale. Many governments, particularly at the local and state level, will sell land that they have acquired through tax foreclosures or other means. These parcels are often sold at a discounted price, making it a notable option to save both a loan and personal funds.
In addition to checking with your local government, you can also search for land sold as part of an estate sale. When someone passes away, their estate (including any land they own) will often be sold in order to pay off any outstanding debts or taxes. This provides the option of buying land at a discount, as the heirs of the estate may be eager to sell the land quickly in order to settle the estate. To find estate sales, you can start by checking with your local county clerk’s office. They will often have information about upcoming property sales, and you can also check online to scan for any listings of land that is being sold as part of an estate sale. It can also be advantageous to discuss your plans with a local real estate agent, as they may have additional information.
Owner Financed Land
Finally, you can also purchase land through a land contract (owner financing) or a lease-to-own arrangement. With land contracts, the buyer will make monthly payments to the seller of the land. After a certain number of payments, you will own the land entirely. With a lease-to-own arrangement, you will rent the land for an established number of years, and at the end of the lease period, you will have the option of buying the land. These types of compromises are extremely easy to make and can save the buyer from applying for a loan.
How Will You Choose to Purchase Land?
Buying land without getting a loan a great option for beginner sellers or anyone who wants to save money on their purchase. Whether you save up the money to pay in cash, look for land that is being sold at a discount, or consider a land contract or lease-to-own arrangement, there are many courses of actions that can be taken to buy land with solely your own savings. By being proactive and taking the extra time to research, you can find a great deal on land and avoid the need to take out a loan to finance your purchase.
