February 24, 2023Land Loans: Everything you need to know.
What is a land loan?
Land loans are used to buy property without a home on it. Sometimes these are confused with construction loans, which are for people who want to build a house. The difference is that land loans are typically used by people who want to build a home in the future but may not want to jump into building and financing a home immediately.
Types of Land Loans
Unimproved Land Loan: a loan for large plots of land with no structure on them, and without a current source of water, or septic/sewer.
Improved Land Loan: a loan for land that is more or less ready to build on, has access to roads, and includes water and septic/sewer. This land won’t require major developments to get started.
How do land loans work and what does PEFCU offer?
A land loan allows you to purchase a plot of land in the perfect location to build your dream home. In a housing market with low inventory, land loans really give you more options on where to set up new homes for your family next.
At PEFCU, we finance land loans up to ten acres of unimproved land (without a current source of water and septic/sewer) or improved land (with water and septic/sewer).
How To Apply for a Land Loan
Get prequalified today! A prequalification letter is a document from PEFCU stating that we are tentatively willing to lend you up to a certain loan amount. This document is based on certain assumptions and is not a guaranteed loan offer, but it lets the seller know that you are likely to be able to get financing. PEFCU will pull your credit report to evaluate your creditworthiness for a prequalification. Call one of our Mortgage Loan Officers at (800) 226-6673 x6515 or click here to get prequalified today!