What's the difference between a land loan and a mortgage?
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Land loans are specifically for purchasing vacant land, while mortgages are for buying property with existing structures. Land loans typically have higher interest rates and require larger down payments (often 20-50%) compared to mortgages.
What factors affect land loan interest rates?
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Several factors influence land loan rates including your credit score, the loan-to-value ratio, the type of land (improved vs. unimproved), loan term, and current market conditions. Lenders view land loans as higher risk than traditional mortgages.
Can I use this calculator for commercial land loans?
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This calculator provides a general estimate that can be used for both residential and commercial land loans. However, commercial land loans may have different terms, rates, and requirements, so it's best to consult with your lender for precise calculations.
What's the typical down payment for a land loan?
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Down payments for land loans generally range from 20% to 50% of the purchase price, depending on the lender and the type of land. Unimproved land typically requires a larger down payment than improved land with utilities and access already in place.