Let's say that you wanted to purchase x acres of land to use for recreational purposes (i.e. Ride ATV's, hunt, build a cabin someday, etc.). How would you go about getting financing? I have a mortgage and established credit history. I've yet to find a bank that I recognize that offers land loans though. Has anyone done this?

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There are banks that offer land loans, they normally require 25-30% down payment at the minimum. My credit union offers them. I looked into it a couple of years ago when I was thinking about buying some land.

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You might want to see if someone is offering owner financing on land in the area you want to buy. I have seen lots of listings for land with owner financing. I'm sure it would be much easier than dealing with a bank. This website has a lot of land for sale and some of it is owner financing. www.landandfarm.com

Is there some kind of governmental agency (farm association) that you could find online that would point you in the right direction? Surely farmers buy land and need financing.
Some friends of ours bought (a house and) a Christmas Tree farm and it was mortgaged as a Christmas Tree farm (not as a house, the house was incidental).

There is. I found one place looking online that specializes in loans to farmers. The catch is that 50%+ of your income must come from farming to qualify for a loan through them.

Cool. Thanks. I'll check that out.

Yeah...I've seen a few of those. That much down and usually high interest rates. I may as well just go take out a title loan on the car. lol.

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It looks like Farm Credit is a viable option. On their website, it sounded as if you had to be in farming...but the loan officer I spoke with said that isn't the case.

On vacant land...they finance between 75-80% of the assessed value or the closing cost (whichever is less). Their average fixed rate loan is 6.25% interest. They have some kind of co-operative program (dividend/profit sharing) that impacts the interest rate...making it effectively 5.5% (average). Fixed terms go up to 20 years.

Anyways...I may raid my 401k for the down-payment...as this would be intended for building our retirement cabin someday. Land paid for by age 50 would be nice.

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In SC land with trees can qualify as agricultural. That's what our land is and we got a loan through BOA. We did intend to (and did) start building within 6 months, but I don't remember if that was a requirement.

It gives us a good tax break too. I guess if we ever harvested the trees it might be a problem, but that is not going to happen. We like living in the woods.

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Copper's Mom (always)
Gotcha 10/2004 - lost ya 10/2010

That's the problem with a lot of land around here. People sell the timber and then the land. I would imagine that the timber is worth more than the land in many parts of VA. It's a shame though to see land that has been pillaged of the older trees.

Yup. That's what I like about our house. We're butted right up to the woods. While we live in a subdivision, but the trees give us the "out in the sticks" feel.

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I'd check out foreclosed properties as well.. who knows, you may find one with your dream home on it for dirt cheap. Don't know about there, but in TX there are a ton of foreclosed farms/ranches up for grabs. It's sad for the families that are going through it, but some of my closest friends have gotten some amazing deals on some large acreage.

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Remington Byrd's Golden Shot - "REMY" - CGC, Therapy Dog, Service Dog
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I, too, was going to suggest Farm Credit. They frequently make those types of loans.
Often they also allow you to put money in their "funds available" account or something similar, which pays excellent interest rates, but only if you have a loan with them.

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