Four Tips for Purchasing Your Perfect Hunting Property
Many people dream about owning a tract of hunting land. Some purchase hunting land for use right now, some purchase it as an investment and others purchase with the dream of handing it down to the next generation to enjoy. Whatever your reason, below are four quick tips to help you through the process.
1. Walk the property! – If you’re interested in purchasing the land for a long-term investment and/or for years of family enjoyment it’s important to physically go out and walk the land. You can do so by either getting in contact with the seller to obtain permission or by reaching out to the listing realtor of the property. Most realtors, particularly realtors who specialize in land sales, are happy to walk the property with you. Many of these specialty realtors will have some amazing information to provide, such as what types of game you can expect to find on the property, if there are feed lots in existence or where a feed lot would work well. They’ll also likely be able to share great information on how to manage the property.
2. Confirm access to the land – Unfortunately, there have been instances where people have purchased land only to find out afterward that they’re unable to access it. This is called “Land Locked.” When investigating the purchase make sure to ask the seller if the land is accessible via a public road or easement. Make sure to follow up with an Attorney or Title company to confirm and draft any documents needed.
3. Check Zoning – Planning to build a cabin, have horses or start a business on the property? Make sure to review all zoning and other restrictions before you purchase. Some properties won’t allow certain types of structures, horses, livestock, guest houses, etc.
4. Understand the Financing – Getting a loan for hunting land can be very different from other types of property loans. Make sure you do your homework and connect with a trusted lending partner. Some lenders, including many large nationwide lenders, will not finance hunting land because they are not secondary market eligible (can’t be sold on Wall Street). Look for lenders in your area that specialize in farm or land financing, as these lenders are more likely to offer financing for hunting land.
Another thing to note: the down-payment for these properties is typically more than one for a home purchase. Also, some lenders will only finance these types of properties using a short-term loan (higher payment), ARM (Adjustable Rate Mortgage) or Balloon (Loan will be due in a few short years) type loan.These loans might help you initially purchase the property, but could put you in a tight spot with your cash flow now or in a few years if your rate goes up or when have to re-finance again (additional costs) to pay off the balloon.
Look for a lender who offers long term fixed rates for hunting and rec land financing. These types of loans allow you to extend the term and your rate will never change, meaning your payment won’t change and you’ll never have to refinance and pay additional costs.
Want to learn more? Find one of our Home Mortgage Specialists in your area. They can help answer all of your questions around hunting and rec land financing.