Buying some land

snakeblitz33

snakeblitz33

Well-Known Member
Hello all!
So, my wife and I decided a few years back to move out into the country. I have been looking into rural development loans - which are loans that require no down payments and the interest rates are about 3.5%. There are two main conditions - you can not own or have a mortgage on a house already and the loan can not be given on land within city limits. We will be able to meet these two conditions.
The problem is... once I get approved for a loan, I don't really know what I am looking for. I know that I want some flat land - and perhaps some type of water feature. I want to be able to grow a nice orchard and plenty of vegetables. All of the places that I have looked at so far that I can afford are all hill-country. Up and down, up and down... I also don't know much about soil types, but every location that I have been to looks like it's all red clay-like soil. I can't find any of the good loamy brown soils that I am so familiar with in the city limits. I'm not sure even how to start growing anything in red clay soil.
The other concern that I have is that many of these places that I have looked at so far say that "mineral rights are reserved." The way I see it, I could buy the land and then the mineral right owner could come in and start strip-mining the place. What do other people do when buying land?
Once I get approved for the loan and know about my spending limit on land, should I contact a realtor (or two) about looking at some land, or should I find it on my own? What's the best route?
Thanks ya'll for the help. I really appreciate any insight for those of you who have done this before.
 
jay0705

jay0705

Well-Known Member
a realator is nice. They do alot of the leg work. Also they can help w the mineral rts. As far as to what's involved and such. Its just easier to have somebody help w the process especially if you've never done it b4.
 
reefraff

reefraff

Active Member
Mineral right laws vary state to state but rest assured nobody can come in and strip mine your land. A friend of my brother down there is pulling in 700 or so a month for surface rights on a nat gas well on his property, or was before the gas prices tanked.
Unless you want to do large scale gardening you can always bring in peet moss or some other organic material and till it into clay to make it farmable. If you could find property near a good sized river with high ground for a house usually the soil along rivers is good.
 
2quills

2quills

Well-Known Member
Hmmm...may want to look into it some more. Im sure there's more to it than just the two requirments that were listed. The dwelling and your income im sure would both have to meet whatever the requirments are.
My experience looking into government grants or loans is that there are typically a rediculous amount of qualifications to meet in order to get them.
 
2quills

2quills

Well-Known Member
I think your best rout is going to be to contact your local usda office. http://eligibility.sc.egov.usda.gov/eligibility/welcomeAction.do?pageAction=pageLoad&requestInfo=DirectContactInfo&NavKey=contact@11
Once you determine that you can qualify and are comfortable with the terms, conditions and available locations then I'd start searching for property.
 
snakeblitz33

snakeblitz33

Well-Known Member
Trust me, I am extremely used to jumping through government hoops to get the aid that I need.
There are other requirements, and we have looked into them and qualify. I mainly need help with what to look for as far as the land goes...
 
2quills

2quills

Well-Known Member
Well if I were you (and this is just me) I would look for property that already has what you want. Like a small farm or ranch and save yourself the headache of building from scratch. Preferably a bank owned property that you can just fix up.
 
reefraff

reefraff

Active Member
Not sure what part of La you want to be in but check this out
http://cenla.craigslist.org/reo/3616652504.html
 
2quills

2quills

Well-Known Member
Quote:
Originally Posted by SnakeBlitz33 http:///t/395395/buying-some-land#post_3520029
How would I go about finding a bank owned property? Find them in the foreclosures?
Yes. But now that I look at it you might be better building a new house on a property. If you're going with that guaranteed loan there are other stipulations that are actually layed down by the lender. The way it sounds is that they typically limit you to a few acres with these loans. And the property can only be a bare minimum it can't contain anything considered to be a luxury. For instance, like a swimming pool or a large plot of land 10+ acres that isn't deemed absolutely necessary as a function for living.
The good thing is that it looks like pretty much everywhere can be considered a rural area accept for right around large towns or cities. And in northern, LA that would be the areas surrounding Shreveport, Ruston and Monroe.
Sounds like a popular thing to do is get a small piece of land and put up a pre-fab home or trailer on it that's built to spec in order to meet the governments code requirements.
 
snakeblitz33

snakeblitz33

Well-Known Member
Quote:
Originally Posted by 2Quills http:///t/395395/buying-some-land#post_3520067
Yes. But now that I look at it you might be better building a new house on a property. If you're going with that guaranteed loan there are other stipulations that are actually layed down by the lender. The way it sounds is that they typically limit you to a few acres with these loans. And the property can only be a bare minimum it can't contain anything considered to be a luxury. For instance, like a swimming pool or a large plot of land 10+ acres that isn't deemed absolutely necessary as a function for living.
The good thing is that it looks like pretty much everywhere can be considered a rural area accept for right around large towns or cities. And in northern, LA that would be the areas surrounding Shreveport, Ruston and Monroe.
Sounds like a popular thing to do is get a small piece of land and put up a pre-fab home or trailer on it that's built to spec in order to meet the governments code requirements.
I really do want to build my own house, ... act as my own contractor, under supervision by a real contractor of course. I'll have to look at all the details and permits before I buy the land to make sure that is possible. Typically here in Louisiana the rural development loans are limited to 10 acres or less. But, that's fine. That's a lot of land to take care of for me - and it will give me plenty of space for an orchard, garden, and my animals. :D I also don't really want a swimming pool either - lol. Just one of those things I can live without.
Yeah, I'm looking at about a 20-25 minute commute from all the places that I have mapped out so far. I have went to a few places and kept track of my mileage and the time. It seems really doable - since even some places within some cities can cost up to 45 minutes of your time to commute!
As part of the rural development loan, 60 days after closing on the land, you have to put up a habitable dwelling. That means that essentially you would have to put a trailer on it and then over time build a house to spec. But, I'm ok with that - and that is what I want to do. Nothing wrong with waiting a little longer in life. I'm just happy that I have this wonderful opportunity.
 
beth

beth

Administrator
Staff member
Actually, if you are going to be the one in charge of the building, you don't hire a contractor. That will cost you more for someone who isn't doing much at all. You subcontract the jobs with the people who actually do the work. You will want to get licensed subcontractors to do the work, and make it clear that you are going by the book with permits and codes and see that they can assist you with that. If they are licensed, they should be able to do that. Maybe you can find a contractor who is willing to just consult if building is slow in your area and they don't have a lot of work going on.
You are still in school aren't you? You sure you want to commit to a long-term property ownership before you have established a career? You may find it necessary to move once you are out of school. Selling a parcel of land in the country may not be that easy if you find yourself needing to relocate.
 
snakeblitz33

snakeblitz33

Well-Known Member
If i get some land in a certain area, ill be within 30 minutes of four major cities. Im sure i can find work as a Biology teacher in one of them. Im not worried about work. Im a taxidermist by trade and can almost work anywhere. Especially if i open my own shop.
I figure if the payments are cheap i can spend the next year paying on some land and pay it off after i start working full time again.
I dont think i should have any trouble finding work as a biology teacher. In fact about 90% of people that graduate with my degree get jobs right out of school.
Im not moving out of state either. My family is here and id rather find other work than moving somewhere far away from them.
 
reefraff

reefraff

Active Member
Be nice if you could find a place with an old single wide on it. Saves you the expense of pulling in utilities or digging wells and septics. It's amazing how fast that stuff adds up.
 
2quills

2quills

Well-Known Member
Quote:
Originally Posted by reefraff http:///t/395395/buying-some-land#post_3520109
Be nice if you could find a place with an old single wide on it. Saves you the expense of pulling in utilities or digging wells and septics. It's amazing how fast that stuff adds up.
Yep, that's pretty much what I was getting at earlier as apposed to building from the ground up. Depending on location you are probably talking about tens of thousands of dollars just bringing in the utilities. Before ya know it, half your loan is gone and the real work hasn't even begun yet. Not to mention all of the unforeseen expenses that pop up. Or the contractors trying to short change ya and cut corners any chance they can get, or just leave you hanging all together.
 
deejeff442

deejeff442

Active Member
let me tell you this. i have been in construction for over 25 years. i bought 5.5 acres.i am building my own house. most banks that do construction loans want 40-50% down. you are in for alot of surprises to say the least. i can build a house from the ground up(except for a/c. which my good friend does). you have no idea what it takes and costs to build if you are not a builder. my suggestion is find a house on a nice lot or land and finance it. i have over $40,000 into this project and just have water ,fencing and more or less my foundation poured also a 20 by 20 gararge. that dont include the land.dont open a can of worms till you know alot more than you do right now. just my opinion
 
2quills

2quills

Well-Known Member
Quote:
Originally Posted by deejeff442 http:///t/395395/buying-some-land#post_3520114
let me tell you this. i have been in construction for over 25 years. i bought 5.5 acres.i am building my own house. most banks that do construction loans want 40-50% down. you are in for alot of surprises to say the least. i can build a house from the ground up(except for a/c. which my good friend does). you have no idea what it takes and costs to build if you are not a builder. my suggestion is find a house on a nice lot or land and finance it. i have over $40,000 into this project and just have water ,fencing and more or less my foundation poured also a 20 by 20 gararge. that dont include the land.dont open a can of worms till you know alot more than you do right now. just my opinion
How long had you been planning on building your home before you actually started breaking ground, Jeff?
Seth's situation would be a little different then most if he uses this program. But the more I read about it, the more I'm skeptical about him being able to build from the ground up anyways. Not that it has anything to do with, Seth. It just sounds like he's going to be quite limited on what he's going to be able to do in order to get loan approval through the program.
It sounds like there are essentially two types of rural development loans. One comes directly from the USDA (or taxpayers) and the other is the Guaranteed home loan which is a traditional bank loan that is backed or guaranteed to the lender by the government (tax payers). The Guaranteed loan from what I understand won't cover construction loans such as what you'd need to build in the first place. And the Direct Loan that comes through the USDA has a much lower income cap which sounds to me like not much money at all. Therefore bringing in utilities probably won't be in the budget. The Guaranteed loan through lenders have a whole other set of requirements by those lenders that go above and beyond just what you need for USDA approval.
Interest rates don't necessarily seem guaranteed at that lowest rate as the USDA website claims, lenders have the right to raise it a bit essentially if they deem you higher than average risk. Or at least, that was my interpretation.
And with their rule of having to have a livable space on the property within a couple of months that meets their approval sound as though this limits his options quite a bit. Possibly even the reason why it sounds to me like a popular thing to do is put up a pre-fab home quick. HUD house, anyone?
Seth, bud, you need to call the the Guaranteed Loan Coordinator in your state. He's the one that directs you through the process and puts you in contact with the folks that you'd be dealing with. Looks like there's only one guy for your state. His contact info is on this page... http://eligibility.sc.egov.usda.gov/eligibility/welcomeAction.do?pageAction=GetRHContact&NavKey=contact@12
Can't hurt to call and just ask some questions.
 
snakeblitz33

snakeblitz33

Well-Known Member
Wont hurt at all. Thanks for all the additional information.
Of course, we are looking at places in the country that already have buildings - whether it is a house or a single wide trailer. It will save a lot of money on getting utilities. Although my main long term goal is to get off the grid.
 
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