Frequently Asked Questions About Financing a Home Site
Whether you are planning immediate home construction or plan to build sometime in the future, chances are you will have questions about financing the home site. GreenStone's rural property financing experts have compiled a list of the most frequently asked questions about finding and financing vacant land intended as a future home site. We hope these FAQs will help guide your quest for the perfect build site!
What do I need to know about financing a home site?
GreenStone can finance home sites all the way from small, rural lots up to expansive acres. Our financing terms are customizable to your needs, including terms from 5 years to 30 years, with a 20% down payment for home sites. If you are just beginning your hunt for the perfect land, GreenStone does provide loan prequalification options to assist you in establishing your budget. View our disclosures page to see an example of the loan structure.
Where am I able to finance a home site?
You'll find that different lenders provide different options. Our regulations allow us to finance home sites in the country, including plots of large acreage. We have several options, and therefore recommend you contact your local GreenStone office to discuss your desired plans with one of our experienced and knowledgeable financial services officers.
How can I determine if a lot is buildable?
We recommend working with your builder to do a site visit. Aside from elevation observations and excavation needs, their expertise will also help guide your next steps, such as completing a perc test to determine septic options, or performing a water supply test if a well will be needed.
What kind of home can I build?
Local zoning and ordnances may impact this answer; talk with the township to understand your options. In addition, the property could impact the building options; for example, a flat parcel may prohibit a walk-out basement. Your builder will be able to provide you with the options when you find a lot that interests you. When it comes to financing, GreenStone is able to finance most styles of homes. Coordinating with your township, builder and lender will be important to ensuring successful home designs decisions.
Will the home site provide for my lifestyle goals?
When considering a future home, it is always best to start with your wish list for not only the land, but also for the community around the land. You will want to make sure the location you are considering matches your lifestyle and interests. Some topic you may want to consider include:
- Is the length of commute to work important?
- Is the school district one that is right for your family?
- What activities are important to you, such as access to outdoor options like river trails, fishing spots, or hiking options?
- How much acreage is needed for your family’s goals, such as back yard adventures or part-time farming?
- Are you looking for a short drive to larger cities to enjoy dining, shopping or entertainment?
It is good to think through your long-term goals for your future home location and share those priorities with your realtor.
What should I consider when it comes to utilities?
With the help of your real estate professional and builder, you will need to determine your options for utilities at the property to live the lifestyle you want to lead. Things to consider are:
- What will it take to get electrical power to the property? Those costs can vary widely based on how far away from the lines your home will sit.
- What heat source do you want and what will be required to get it, such as natural gas, propane, electric, geothermal, or another system.
- Regardless if you work from home or have gamers in the family, reliable internet is often a must for many families. Call local providers to identify which will serve your area and what you need to know for getting service to your planned home.
- Where is the water table in the area and what depth of well will be needed if a public water system is not available?
- What type of septic system will be needed if a public system is not at the location?
Does the land have covenants (restrictions or rules for future owners) associated with it?
Title work completed during the lending process will show if there are any prior liens. The township will also be able to help identify if there are access issues for the property. Your realtor should be able to provide additional information about any restrictions or land use rules.
How is the land zoned?
The seller will be able to tell you how the land is zoned. In addition, a GreenStone loan officer can pull up the tax ID to help you identify how that property is zoned.
What do I need to know about flood zones?
When you apply for a loan at GreenStone, we will check flood zones to determine if the land is in a flood zone. If we find it is in a flood zone, we will be able to move forward without flood insurance at this time because it is just vacant land. When it’s time to build, you would want to speak with your builder to see if there is a better spot on the land to build on. Depending on the final decisions, we may require flood insurance as part of your financing agreement.
Will I be able to hunt on the land I am purchasing?
Many of our customers look for a home site with acreage on which to both live and hunt. You will want to contact the township to confirm any laws regarding hunting which impact the property. Additionally, you’ll need to identify whether the property is large enough to provide adequate distance from other houses and properties to ensure safety.
What haven’t I considered?
Starting with a prioritized plan and creating your list of questions up front will not only help you focus your search, but will help you be prepared to act when the time comes. Once you find a lot, consider visiting the property at several different times and days of the week to help understand the full experience – traffic patterns, noise, and nature could reveal other things to be aware of. And don’t forget to consider the property around you – those properties could be used one way today, but that could change in the future. Consider your property plan based only on factors you can control within the boundaries of your own land.
When it’s time to start considering your home build, please visit our Home Construction FAQs page to for detailed information about contractor-built or DIY home construction loans.