| Question: What is usually required for a down | | | | 1. The ability to repay a land loan is always the |
| payment on a land loan? | | | | highest priority for any land loan lender. Detailed |
| Answer: When looking for a land loan and trying to | | | | analysis is done on applicants wanting a land loan to |
| determine what you might need for a down | | | | determine what down payment is required. Personal |
| payment you can typically expect a range between | | | | and or corporate balance sheets, tax returns, and |
| 20% to 40%. Each land lender has different | | | | credit history all play an important role in determining |
| parameters, but we have listed 3 key factors that | | | | if someone is capable of repayment for a land loan |
| usually hold the most significant value to land lenders | | | | and ultimately what is needed as a down payment. If |
| when determining what you may need for a down | | | | a solid repayment capability can be determined than |
| payment on a land loan. | | | | the amount allowed to be borrowed could be |
| 1. Repayment capabilities | | | | increased causing potentially a lower down payment. |
| 2. The appraisal and/or purchase value | | | | If repayment is marginal and causes increased risk, a |
| 3. Collateral value from land already owned | | | | larger down payment could be expected. |