Loans for Land - Find the right option for you.
Specialist finance for future developments and land investments.
Build your future with the right kind of finance.
Found the perfect plot of land and want the finance to match? Whether you’re searching for a loan for property development on the land or simply want to borrow money to buy the land as an investment for the future, there are specialist loans for land that exist. The key to securing one is our team.
Understanding loans for purchasing land.
Loans specifically for the purchase of land come in many forms, and the type of land loan will usually depend on what you intend to do with the land once you’ve purchased it.
Types of land loans:
● Agricultural mortgages
● Property development finance
● Bridging loans for land
Not all lenders offer each type of land loan, and if they do, there’ll likely be variations in the terms and rates available.
How loans for land work.
Loans for land work a lot like conventional mortgages in that a lender provides funds, and these funds plus interest are then repaid over an agreed period of time.
However, because of the higher risks associated with land - especially if you’re yet to receive planning permission - qualifying for a land loan can be more complicated than conventional mortgages. In addition to credit score and affordability checks, lenders may need to see comprehensive plans of how you intend to use the land, as well as details of the relevant planning permissions and any land use restrictions.
Another important consideration is how you plan to exit the land loan, whether through converting it into a mortgage, developing, or selling the land with planning. The lender will need to be assured that you have a clear and viable exit strategy in place.
Pros vs Cons
Weighing up your options when borrowing money to purchase land is crucial. Understanding the pros and cons can help.
Securing a land loan might give you access to land ownership that you couldn’t otherwise achieve
Unlike development loans, land loans don’t require you to begin developing the land right away.
Land loans can allow you to acquire larger parcels of land, which may be difficult to finance through traditional means.
Potentially large down payment and high interest rates
Only finances the land purchase not any development plans (visit our development finance page for more on developer finance
The lender may require detailed plans and land appraisal
With or without planning permission, we can help.
Securing a loan for land can be quite complex when you’re going alone, but that doesn’t have to hold you back. Our team has the knowledge and experience to be able to help, even in situations where you haven’t received planning permission yet.
Aside from our knowledge of the specialist lenders and their appetites, we also have a streamlined process for securing your finance, meaning funds won’t be the reason your purchase can’t move forward.
FAQs
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There are many different types of loans for land, and some are suitable for financing a residential construction project. It’s best to check your options with an experienced broker like Key.
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Yes, you may still be eligible for a loan for land if you have a bad credit history. There may be a greater limit to the products available to you, and there may be stricter terms such as higher interest rates or larger down payments.
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Yes, you can still get a loan for loans if you don’t have plans to develop the land. For example, people may purchase land as an investment if there’s reasons to believe the value of the land will increase. Lenders may need to see good evidence of how you intend to repay the loan, and a clear understanding of the purpose of the acquisition.
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Deposits for land loans are typically higher than those for standard mortgages. The amount required will vary depending on the lender, your financial situation and the intended purpose of the land but can typically be around 25-50% of the land's value.
Not Sure a Land Loan is Right for You?
If you’re unsure whether a land loan is right for your needs, consider exploring other financing options. If you plan to develop property, developer finance may be a better fit, while bridging loans can be ideal for short-term requirements.
Request a Callback
Need more information or have a question? Our team is here to help. Simply fill in your details, and one of our experts will give you a call at a time that suits you.