Estimate monthly payments, interest, and total cost for a land or lot loan
A land loan (also called a lot loan) is used to purchase vacant land or a building lot. Land loans typically have higher interest rates and shorter terms than standard mortgages because land is considered a riskier investment — it does not provide immediate income or serve as collateral in the same way a home does. This calculator helps you estimate monthly payments and compare land loans to conventional mortgages.
Down payment requirements for land loans are often higher than for home mortgages, typically ranging from 20% to 50% depending on the lender and the type of land. Use this calculator to plan your land purchase budget and understand the true cost of financing raw or improved land.
Land loans typically have higher interest rates (1-3% higher than mortgages), require larger down payments (20-50%), and have shorter terms (10-15 years vs. 30 years). This is because raw land does not generate income and is harder to liquidate if the borrower defaults.
Common types include raw land loans (for undeveloped land), improved land loans (for land with utilities access), construction-to-permanent loans, and USDA loans for rural land. Some sellers also offer owner financing for land purchases.