The purchase of land can be made with two types of loans, either a home loan or a personal loan (consumption). The type of loan will mainly depend on the amount of land to buy and especially if it is building land or not.
Many households are looking to buy land, whether or not related to a house building project. Simply, the type of credit that it is possible to take out will depend on the amount of land to buy, in other words, below 75,000 dollars, we are talking about a personal loan, beyond, we are talking about a home loan. The only disadvantage in the context of a mortgage is the requirement of the bank to have a guarantee on the property to be built (so you must have a well-defined construction project) or a bank guarantee.
Buy land with credit
For personal loans, banks can grant up to 75,000 dollars over 120 months, or 10 years. The advantage is to be able to buy all types of land, buildable or not, with this financing because the bank is not required to require guarantees, even if the latter will request information when setting up the financing.
Before applying for good credit, you also need to know whether the land is serviced or not. If it is not the case, it will be necessary to foresee the cost of the servicing in the loan, in order not to have unpleasant surprises and to find oneself blocked in its project of land purchase, in particular, if the latter is doomed to a house building project. You must, therefore, quantify the acquisition of the land and all additional costs, including going to the notary for the drafting of the authentic instrument stating that you are the new owner of the land.
Simulate a loan to buy the land
Have you spotted a piece of land and you want to know if it is possible to obtain a loan to be able to own it? It is, therefore, useful to carry out a credit simulation including the amount of the land and the ancillary costs. You should know that the purchase of land will involve going to the notary and therefore the payment of fees but also notary fees. You will also have to rely on borrower insurance to cover the reimbursement of monthly payments in the event of temporary or permanent incapacity or even death. Optional but required coverage for all loans extended to borrowers.
The simulation will allow these elements to be taken into account and a more precise estimate of the repayment rate and duration to be obtained. It is simply necessary to inform the amount of the credit by opting for the loan of cash, a personal loan that one can obtain without being justified on the use of the sums. After validation of the form, several proposals are sent to allow the borrower to plan for the purchase of his land, whether it is intended for construction or not. With several offers, it is easier to choose the best offer to finance your acquisition.