construction
Lot Financing
Buy the land now, build when you're ready — financing for residential lots so you can lock in a homesite without paying all cash.
Eligibility
- For vacant residential lots intended for future home construction
- Financing available for improved and, in some cases, unimproved lots
- Down payments are typically higher than a home mortgage, often 20–35%
Key benefits
- Secure a homesite without paying all cash upfront
- Preserve your liquidity and investment assets for later
- Lock in today's land prices in desirable, growing areas
- Can often roll into construction financing when you're ready to build
What is lot financing?
Lot financing is a loan designed to help you purchase vacant land for future residential construction. Whether you plan to build a custom home soon or simply want to secure a desirable homesite before construction begins, a lot loan can provide an affordable path to ownership without tying up all your cash.
Who it's for
Buyers who have found the right piece of land but aren't ready to build yet — including those planning a future custom home, anticipating retirement or relocation, or wanting to lock in property in a preferred neighborhood before prices rise.
Planning to build
Property taxes, insurance, and maintenance remain your responsibility as the owner. When you're ready to start construction, the lot loan can often be paid off or incorporated into a construction-to-permanent financing solution — giving you the flexibility to secure the property today while planning for tomorrow.
Frequently asked
- How much do I need to put down on a lot loan?
- Down payment requirements on land are generally higher than on a traditional home mortgage, often ranging from 20% to 35% depending on the property, location, and whether the lot is improved.
- What kinds of lots can be financed?
- Financing is available for improved lots and, in some cases, unimproved land. Lots in established subdivisions with utilities typically qualify for more favorable terms than raw land. Guidelines vary based on location, acreage, utilities, access, and intended use.
- Can I use a lot loan and then build later?
- Yes. Many borrowers combine lot financing with a future construction loan. When you're ready to build, the lot loan can be paid off or rolled into a construction-to-permanent loan, which may reduce your out-of-pocket costs.