Be Creative! That is what all the people involved in selling real estate are crying. Well I have put together a creative way for you to own for investment, or own and build now, or own and hold to build in the future, whichever you like.
First Option: With a down payment of $20,000 I will take back $67,000 at 5% for 15 years. Your monthly payment would be $529.83 per month.
Second Option: If you take out a loan to pay cash for the property and pay all the appraisal fees and title searches (which will be required to finance the land), the price will be reduced to $82,000. Dumont Land Finance Corporation advertises:
Dumont Land will consider financing rural, unimproved, non-speculative land to be used for future vacation or retirement home, hunting or recreational usage. There is a 5-acre minimum and a $5,000 per acre cap.
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10% Minimum Down Payment
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Points Ranging from 1%-3%
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Terms Available Up to 20 Years as Determined by Amount Financed
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Interest Rates Ranging From 9.5%-13.0% (Fixed and Variable)
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Interest Rate & Points to be Determined by Credit History, Down Payment, Stability, and Deal Structure
Using Dumont, with 10% down your principal would be $73,800, so at 10% for 20 years your monthly payment would be $712.19, not including the points. Here is a link to their web: http://www.dumontland.com/index.html
There are other hard money lenders who specialize in land loans. I found this one to be very specific and does business in Virginia. You can Google ‘hard money lenders’ and see what you come up with.
Third Option: You put $20,000 down, and all the terms in the First Option are the same. Your monthly payment would still be $529.83 per month. You get a construction loan within the first year of this loan which pays the land off with the first draw. I will reduce your principal to $63,000, or if you get a loan at a latter date I will reduce the principal by $100 per month for the first five years. After that full payoff would accrue.
