How owner financing works.

No bank, no mortgage application, no 45-day underwriting circus. You make payments to the seller directly. Here’s the whole thing, plainly.

Banks don't like lending on vacant land. When they do it at all, they want 20–50% down, short terms, and a stack of paperwork that makes a home mortgage look breezy. That's why most of the land I sell, I sell with owner financing: you buy the parcel, I carry the loan, you pay me monthly. Simple as that.

Here's what that actually looks like, start to finish.

The structure: down payment, monthly payment, done

You put a down payment on the parcel, on my land it's typically a modest fixed amount, not a punishing percentage. Then you make a monthly payment, at a stated interest rate, for a stated number of years. Everything is written in a note and signed at closing: price, rate, term, payment. No balloon surprises, no adjustable anything.

There's no credit check on most of my parcels, and no penalty for paying it off early. Pay it off in year two, you stop paying interest in year two.

Who holds the deed?

This is the question to ask any owner-financing seller. There are two honest structures. With a deed and mortgage (or deed of trust), you get the deed at closing and the seller records a lien, exactly like a bank mortgage. With a land contract, the seller keeps the deed until you finish paying, and you hold a recorded contract interest.

Both are legitimate when they're recorded and written clearly. What's not legitimate: an unrecorded handshake contract where nothing shows up in county records. If a seller resists recording, walk away.

What it costs versus a bank

Owner-financed land usually carries a somewhat higher interest rate than a bank would charge, that's the tradeoff for skipping the bank's requirements and timeline. What you save: origination fees, appraisal fees, the risk of a loan falling through after 45 days, and the flat impossibility of getting a small rural land loan approved at all in many counties.

Run the total cost, not just the rate. A clean note with no fees and no balloon often beats a theoretical bank loan you can't actually get.

What happens if life goes sideways

Ask the seller before you sign: what happens if I miss a payment? A fair note has a grace period and a cure process spelled out in writing. I'd rather work with a buyer through a rough patch than take a parcel back, taking land back is paperwork and heartache for everyone, but the process should be on paper either way, protecting both sides.

If you want the full picture before you shop, I wrote a short guide: How to Buy Land Without a Bank. It's free and it's honest. And the parcels I currently have available are on the buy land page.

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