Is your plan for buying land in full or financing it from the land company selling it? Suppose you have found some land that you can pay for with a credit card, and the cost is around $5k. Ask yourself, will using the credit card make sense, or would using the company’s financing option be better for buying land?
First, if you are using a credit card, you will make payments anyway, but you will be paying an APR which can sometimes be around 30% interest or so. If you only make the minimum credit card payments over a long period, you can end up paying $2k on top of it or even more for the loan. Yes, you bought the land in full, you own the deed, but you’re still making payments.
Buying land with a credit card can be a convenient option, but it is essential to consider the long-term costs associated with credit card debt.
By comparing different financing options, you can find the best one for buying land that fits your financial situation.
So, if the land website has financing, compare these APR rates first. Sites like ours, LandZero, have rates as low as 1%, and for longer terms, they still stay extremely low. Some other companies are higher, so look at the options and decide which is smarter. Using financing from a company like ours can save you significant amounts of money while giving you time to pay off the land. Additionally, you can still use a credit card, but you would just be making small payments each time you can pay off without interest on the credit card. It would be similar to making payments on a credit card, but the interest on top would be significantly different.
It’s crucial to understand how the impact of non-payment can affect your ability to continue buying land in the future.
Choosing the right method for buying land can save you from potential credit issues down the line.
When considering your options for buying land, think about your credit situation and how it will impact your decisions.
Using a cash advance might allow you to buy land quickly, but ensure you understand the risks involved in such transactions.
Buying land on credit is a viable option for many, and it offers various benefits, including the opportunity to invest in real estate.
Does the company contact credit agencies if there are payment issues? Chances are they don’t, but if they want a credit check upfront, they might. We do know some more expensive land sellers where they do secured loans and work with credit agencies. So if things get rough and you can’t pay for the land, you could wreck your credit in an unfortunate situation or even lose something.
We don’t contact credit agencies, so if you default, it is a loss of money but it wouldn’t affect your credit score. If you have awful credit already, we still give you the land agreement, we just ask that you pay on time.
Those interested in buying land should consider the benefits of owner financing as an alternative to traditional methods.
When buying land, remember that owner financing can lead to better financial outcomes than relying solely on credit cards.
Credit card companies can be very harsh for a late payment. You can get charged a late fee, a ding on your credit, and it can start adding up fast in rough times. However, a land selling site like ours, where you end up financing, will not report to credit agencies. For one, we own the land outright and approve everyone willing to pay off the land over time. Yes, it ties up our money, most would like the full amount, even us, but it’s a service to our customers.
The worst part of our business is dealing with delinquent payments. Late is fixable, but some people will not pay any further and not respond to us. And yes, we have a foreclosure process, but it’s timely and costs us, plus our land is unsellable during this process.
The point is, any lack of payment or completely dropping payments on the land will not affect a single thing with your credit. If you don’t pay your credit card, though, you’ll end up with major issues. With us, you’ll just be out of the contract and have lost your shot at owning the land. But it’s better than hurting your future; things like home purchases and car purchases can basically end your credit score life. At least with land like we sell, no long-term harm is done.
Another option is doing a cash advance on your credit card. Suppose the person or company is not accepting credit or financing, but you don’t have the cash in the bank. You can often do a cash advance on your credit card. While limits are different with each card, you can deposit cash into your bank and pay back on the credit card over time. Thus, allowing you to buy the land in full because there was no other way to do it. But your interest rates might not make sense doing this.
Overall, it’s pretty cool you can buy land on credit or even use financing. Land ownership is great; it can increase in value, you can flip land, and even make enough to build homes one day. Starting with some low-cost land is not a bad option; in just a few years’ time, we have seen land we sold for $2k-$3k go up into the $30,000 range. Even some in Hawaii that we sold seemed to change value in just two months. So investing in real estate isn’t just for the wealthy; many start small and even do so on credit or other people’s money.
Owner financing land can be the best deal because it allows buyers to make monthly payments directly to the seller, often at way lower interest rates than traditional bank loans or credit cards. This setup eliminates the need for credit checks and lengthy approval processes while offering flexible terms that can suit both parties. Since credit cards aren’t involved a default wouldn’t impact credit score but just account for money lost.
Closing costs and fees are also typically lower, making it a more affordable option upfront. Additionally, buyers who might not qualify for conventional financing can still secure land ownership with a manageable payment plan, making it a great alternative to traditional loans.
At LandZero, rates are as low as 1% if you’re serious about land ownership and willing to pay off within a year. Aside from that, longer dated terms are offered starting at only 3.5% APR compared to a credit card upwards of 30% APR.
Good news is you can still buy the land on a credit card to start your purchase online with an easy buying process. From there, it would be best to make the monthly payments on debit or pay off the credit card each time you use it to avoid that high percentage. Also closing costs are free, no other fees added and what you see is what you pay. If you’re interested in land, take a look at some of our available owner financed land for sale.
Getting a land loan is simply not an option for most unless it’s a very high end lot and very substantial collateral is given. If you are wondering about the process of a land loan process click on this link
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