Financing land - The HuntingPA.com Outdoor Community
Reply
 
LinkBack Thread Tools
post #1 of 13 (permalink) Old 08-07-2013, 10:23 PM Thread Starter
Diehard Outdoorsman
 
Join Date: Dec 2006
Location: Berks, McKean
Posts: 3,375
Back To Top
Financing land

If anyone has any advice to give it would be greatly appreciated. I am looking at a piece of land in Mckean county just shy of 100 acres. I am in need of some advice on who will loan money for a land only purchase. I know of the ag farm credit but never did anything like this before and don't know if there are other avenues i can take. I have easily 20% to put down. I dont plan on building on the land for approx 5-10 years. A home equity loan is not a possibility for me. Does anyone have any experience with doing this? If so any information would be greatly appreciated.
5chunter is offline  
Sponsored Links
Advertisement
 
post #2 of 13 (permalink) Old 08-07-2013, 10:57 PM
Diehard Outdoorsman
 
Join Date: Jan 2011
Location: North Eastern,Pa
Posts: 3,770
Back To Top
Re: Financing land

Your question depends on how long you need to be financed?
Also,are there surface, mineral, and timber rights?
For example, if you can show a lender you have $XXX in timber, $XXX in gas rights, etc on the horizon, that will make a difference. An private person lender will also work well in those situations, if that is an option for you. There are many banks with an agricultural division or specialty. How long do you need their money ?

"Be nice, until its time to not be nice" (Patrick Swayze...Roadhouse)
Joe the Logger is offline  
post #3 of 13 (permalink) Old 08-07-2013, 11:09 PM Thread Starter
Diehard Outdoorsman
 
Join Date: Dec 2006
Location: Berks, McKean
Posts: 3,375
Back To Top
Re: Financing land

The property is 100% wooded but the current owner had a timber contract which expired 2 years ago so right before the contract ended they came through and cut the timber real hard. OGM rights are not owned by the current owner of the property. In all reality I would probably only need the financing for 5 years or so but would like to do a 10-15 year if possible just to be on the safe side cause you never know what you future is in this economy any more.
5chunter is offline  
Sponsored Links
Advertisement
 
post #4 of 13 (permalink) Old 08-07-2013, 11:19 PM
The Man
 
buzz's Avatar
 
Join Date: Sep 2004
Location: Bradford County
Posts: 8,132
Back To Top
Re: Financing land

Banks will finance land purchase. Talk with your bank, I am thinking 20% down should be close to enough for a bank, or possibly a secondary market through your bank.
A word of caution on the OGM rights, be sure you get 100% of surface rights. Some OGM contracts would allow them to put pipelines, well pads, water impoundments, pipe yards, or even mine for gravel if they own OGM's with surface rights.

Your never to old to learn something stupid
buzz is offline  
post #5 of 13 (permalink) Old 08-07-2013, 11:34 PM
Hooked on HuntingPa
 
Join Date: Oct 2012
Location: Pittsburgh, PA
Posts: 258
Back To Top
Re: Financing land

Quote:
Originally Posted by buzz
Banks will finance land purchase. Talk with your bank, I am thinking 20% down should be close to enough for a bank, or possibly a secondary market through your bank.
A word of caution on the OGM rights, be sure you get 100% of surface rights. Some OGM contracts would allow them to put pipelines, well pads, water impoundments, pipe yards, or even mine for gravel if they own OGM's with surface rights.
They will def. do this if you have 20% down. Not so sure about the secondary market on a land only loan, unless there was intent to build early on.
jeffs2813 is offline  
post #6 of 13 (permalink) Old 08-07-2013, 11:41 PM Thread Starter
Diehard Outdoorsman
 
Join Date: Dec 2006
Location: Berks, McKean
Posts: 3,375
Back To Top
Re: Financing land

Thank you everyone for the information so far. I will check with my local bank tomorrow morning. Just from what I have read online it is a difficult thing to pursue. I also live 5 1/2 hours away from the property so my local bank might not be interested in doing that.
5chunter is offline  
post #7 of 13 (permalink) Old 08-07-2013, 11:42 PM
Regular Member
 
Join Date: Dec 2007
Location: Washington County, PA
Posts: 1,872
Back To Top
Re: Financing land

I used Mid West Farm Credit Services when I purchased in Ohio. I believe 25% down plus closing costs. When I purchased land in Pa, Mid West referred me to an associate bank that required 20% down. Ended up going with Community bank with 35% down, plus closing costs, at 4.5%.

Knowing you are going to pay the land off rather quickly, I would pay close attention to closing costs. Mid West was half of every other bank and their interest rate is very competitive. When buying my Pa property, the loan was rather large and I felt more comfortable with more money down and a lower rate.

I can't speak highly enough of Mid West Farm Credit and would urge you to track down their representative lender in your area.

2B, 2A, South East NE, Jefferson National Forest VA
'Pinnin Ain't Easy' 'TR' East Ohio


beck_trt is offline  
post #8 of 13 (permalink) Old 08-08-2013, 12:22 AM
Diehard Outdoorsman
 
Join Date: Jan 2001
Location: Chambersburg,Pa
Posts: 3,112
Back To Top
Re: Financing land

Also get a new appraisel...If you are getting a good price on the property and your appraisel is higher a lender will help you out more so...
burk313 is offline  
post #9 of 13 (permalink) Old 08-08-2013, 12:46 PM
Regular Member
 
Pine-Creek's Avatar
 
Join Date: Apr 2011
Location: Pa Mountains, Life Member NRA
Posts: 2,490
Back To Top
Re: Financing land

5,
If you are a Vet I understand they have money to lend right now.
Pine Creek/Dave

Never care about what other people believe, be strong and walk in the way of the Lord.

Pine-Creek is offline  
post #10 of 13 (permalink) Old 08-09-2013, 01:14 AM
The Man
 
rrroae's Avatar
 
Join Date: Apr 2006
Location: pa,crawford county
Posts: 6,030
Back To Top
Re: Financing land

Mercer County State Bank and Northwest Savings bank are 2 small regional banks I've worked extensively with the past 10 years buying land. You're going to need 25% down and the loan will probably be on the commercial side since there's no structure so figure on around 5 - 5 1/2% interest. In my experience, AG banks charge higher interest but give you some of it back at the end of the year.


The land will be appraised based on raw value. OGMs are something most banks in the area aren't putting any value on as of yet. Figure on the appraisal coming in at around $1,500 - $2,000/acre. You're debt to income with the loan will have to be around 35%.

If you're interested, I can give you the name and number of the branch manager I work with at Mercer County Bank. Good guy who did a little hunting at my place last year and who has helped me a good deal on these type loans.

If Tyranny and Oppression come to this land, it will be in the guise of fighting a foreign enemy JM
rrroae is offline  
Reply

Quick Reply
Message:
Options

Register Now



In order to be able to post messages on the The HuntingPA.com Outdoor Community forums, you must first register.
Please enter your desired user name, your email address and other required details in the form below.

User Name:
Password
Please enter a password for your user account. Note that passwords are case-sensitive.

Password:


Confirm Password:
Email Address
Please enter a valid email address for yourself.

Email Address:
OR

Log-in










Thread Tools
Show Printable Version Show Printable Version
Email this Page Email this Page



Posting Rules  
You may post new threads
You may post replies
You may not post attachments
You may not edit your posts

BB code is On
Smilies are On
[IMG] code is On
HTML code is Off
Trackbacks are On
Pingbacks are On
Refbacks are On

 
For the best viewing experience please update your browser to Google Chrome