Important Factors To Consider When Applying For Your First Land Loan

The purchase of land will provide one with a lot of benefits. This equity by nature will provide the applicant with plenty of financial options, especially since the value of the land appreciates over time.

Therefore, when considering purchasing a land property for the first time, one can always opt for a land loan to make this purchase an easy and financially stable one. However, when using this land purchase loan, one would need to consider certain factors when purchasing land. Here are a few factors to consider today:

Access to the land:

The value of land depends on its accessibility. Nobody would want to purchase a land which is located in extreme locations or which is far away from civilization. When considering a land purchase loan to purchase any property, the land must have access to public roads or a permanent easement granted to access a public road. Over time, the value of the land will also appreciate once the infrastructure to access this land improves.

Utilities and improvements:

As mentioned previously, infrastructure around the land increases the value of the property. If the property one intends to purchase possesses facilities such as paved roads, streetlights, a public sewer, water, electricity and natural gas, then one would need to reconsider the parameters of the loan. If these facilities are not included in the proposed land lot, the improvement of these factors would be considered as a future cost to develop the site. This is especially expensive in the case of private facilities, wherein the construction price will be at the expense of the applicants.

Zoning and land use restrictions:

Most land properties are equipped with fixed zoning and land use restrictions. This has to be carefully reviewed before applying for the land loan. One must check if the land is currently zoned for one’s intended use of the property. The applicant must also check if there is any restriction in terms of the covenants or any other restrictions. Is the land property associated in a homeowners association? If yes, how much would one as an applicant be subjected to?

Future plans:

Any construction around one’s purchased property would affect the future value of the property. Any future sites for schools and parks as well as projected new highways or garbage dumps will help one understand how much pf the value of the property can increase in the near future. For schools and parks as well as projected new highways or garbage dumps.

Boundaries for one’s property:

Most land purchase loan depends on the area of the property. When opting for this loan, one should ensure that a stake survey is undertaken to mark the corners of one’s lot. In addition to this, it is important to know exactly what’s included on one’s site especially for irregular acreage.