No Money Down Owner Financing
Let’s talk about how to buy land with no money down. Some land owners will be willing to offer financing to buyers.
What is the lowest down payment for land? When it comes to land, in many instances, the expectation of the seller is a huge down payment of 30% or 40%, and many are willing to carry or be a mortgage lender for the remaining balance of the purchase price. The document that is used for this type of sale is referred to as a Land Contract or a Contract For Deed.
Generally speaking, loans are difficult to obtain from a local bank when they are aware that the loan is for land. Bankers feel the risk is too high.
Though it’s not unusual for a seller to request a down payment that is high, sellers are motivated in high-interest markets to accept installment sales. It may be possible to negotiate a contract with the seller for no down payment.
Many in the market are searching for a low or no down payment. With the seller acting as the banker, these are rare in good markets because they are the only financing in poor real estate markets.
Buildable residential land can be readily purchased and financed with payments because it’s easily sold and has considerably higher value. However, it is commonly sold with 20%-25% down payments and long-term financing of 10 years.
USDA or VA Loans for Land With No Money Down
Here’s a way to buy land with no money down. Two distinct programs stand out, USDA land loans and VA loans.
The United States government grants eligible buyers the opportunity to buy land and build on that land, if they are doing so in a remote area.
These are little-known Department of Agriculture loans, which encourage people to own homes and tracks of land for farming. The department of agriculture will offer 100% loans for buildings in rural areas.
Additionally, another zero-down loan will come from the Veterans Administration. This is a loan which Is guaranteed by the United States Veteran Affairs for people who have served in the military. The objective of the loan is to help military people to get started.
It is not easy to purchase land with zero down payments, especially raw land. These loans when they are made have high-interest rates and require special skills for the purchaser in order to pay the high-interest rates.
How to Buy Land Cheap at 60%, 70% or 80% Below Value
I’m a solutions guy so here’s an alternative that includes raw land, improved land, and residential vacant lots. These properties are tax-defaulted, and they’re available in all 3,000+ counties.
These are properties like homes, vacant residential lots, small farms, and small office buildings that have defaulted on taxes. The treasurer of the county has confiscated the properties and will sell the properties at auction to the highest bidder.
For over 200-years this subset of traditional real estate has been mandated and executed in all of the states in all of the counties.
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The county does not want these tax delinquent properties. To facilitate the sale and make the auction move along quickly, the treasurer will discount the auction price by 60%, 70%, and 80% below the tax assessed value.
The county will sell at a low price with starting bids of just the back taxes, and when the property is sold at auction, the treasurer is authorized to delete the mortgage or deed of trust loan.
Some of the properties that can be purchased are raw land, farms, and rangeland.
In all 3,000+ counties, the treasurer will auction tax-defaulted real estate at least each one year, however, in some counties, it will be multiple times.
Conclusion
We hope you enjoyed Ted’s lesson, “How to Buy Land With No Money Down”
The USDA and Veterans Affairs are good places to look for no money down loans on land. Seller financing may also be available for no money down if you can find an agreeable seller.
If you have some money to put down, you may want to consider a tax defaulted property auction, where land is sold mortgage-free at discounts of 60%, 70, or 80% or more of the tax assessed value.
If you’d like to know more about tax delinquent real estate investing, Ted Thomas provides full support and complete training with home study courses, Q&A webinars, live tutorials, workshops, web classes, and personal coaching with certified coaches.
You can learn how to reap the huge rewards from tax lien and tax defaulted property investing! Get started today by taking advantage of this Free Gift from Ted. Act now, it costs you nothing and will give you a big head start!
Ted Thomas is America’s Leading Authority on Tax Lien Certificates and Tax Deed Auctions, as well as a publisher and author of more than 30 books. His guidebooks on Real Estate have sold in four corners of the world. He has been teaching people just like you for over 30 years how to buy houses in good neighborhoods for pennies on the dollar. He teaches how to create wealth with minimum risk and easy-to-learn methods.
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