Seller Financing Terms for Raw Land - Rates and Term?

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I'm in the process of buying a 10 acre parcel in Lewisville, NC (the west edge of Winston Salem) that was farmland and on which I will build my personal residence. The seller has offered to finance the deal. We haven't gotten to terms yet. Anybody familiar with market terms for seller financing in this area (or generally)? I know we can agree on whatever we choose, but wondering if there is a common structure to seller financing? I see reading around that generally short terms with a balloon payment at 5 or so years are common. Are they generally amortized on a long schedule? How much over a bank rate might I expect to pay? I can do a HELOC for 4.25% and interest only payments through my local credit union (though I won't qualify for the full purchase price there)...

Thanks for any help.

Originally posted by @Christopher Brown :

I'm in the process of buying a 10 acre parcel in Lewisville, NC (the west edge of Winston Salem) that was farmland and on which I will build my personal residence. The seller has offered to finance the deal. We haven't gotten to terms yet. Anybody familiar with market terms for seller financing in this area (or generally)? I know we can agree on whatever we choose, but wondering if there is a common structure to seller financing? I see reading around that generally short terms with a balloon payment at 5 or so years are common. Are they generally amortized on a long schedule? How much over a bank rate might I expect to pay? I can do a HELOC for 4.25% and interest only payments through my local credit union (though I won't qualify for the full purchase price there)...

Thanks for any help.

I've not been in your position of buying land via seller financing for an owner occupied dwelling. I buy land with intent to build or subdivide with more than one improvement as non-owner occupied.

I think there is no right answer. However, if you plan to finance your house as owner-occupied, as construction through programs like Conversion of Construction-to-Permanent Financing (as in a Fannie Mae program) then your loan broker should know what the impacts are (and how to handle) for land financing options. So your loan broker (or commercial banker if you are using one) for the home construction side is a good resource.

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