Questions

Question: I have been doing research for quite some time now, and decided it was time to live off grid. I am looking for 2-20 acres of raw land suitable for growing crops(or has a nice view). If anyone knows a good source I would be much obliged. Thanks. And happy trails! 🙂

Answer:  There are many excellent land sellers on sites like eBay or Bid4assets that specialize in selling expensive land lots for off grid living.  However, always take your time and do your research so you aren’t buying a problem lot that may not be buildable, have potable water easy access or some other issue that could prove very expensive in the long run. Also, be certain your seller is reputable.  Check out www.3fatallandbuyingmistakes.com to avoid making these expensive land buying mistakes I see the typical land investor making every day online. Read More

Question: What are the steps of buying just raw land and with a loan? What kind of questions or information do i need to find out?

Answer:  Whenever you are borrowing money with a land loan, it’s important to understand the amortization table so you don’t agree to putting your self in a negative amortization situation.  That is, with each payment the borrower is only paying towards interest and the principal amount never changes.  Also, most banks won’t loan on land so you will be financed by the seller.  Be certain you understand the monthly payment, interest rate if there is a balloon payment, the term of the loan and if there are any fees or penalties for pre-payment.  You also want to be certain that if they are using a land contract that they guarantee in writing that the deed will transfer free and clear of any liens or encumbrances.

Also, don’t be afraid to negotiate for a lower interest rate, payment or better terms. Read More

Question: I know the county takes the land but the thing is I don’t care, I’m tired of paying taxes on raw land i don’t plan on doing anything with. I mostly want to know if they can ruin my credit or send me to collections or what.

Answer:  If you are certain you won’t ever use the land you should try selling it before the County either sells it  for non-payment of taxes or sells a tax lien on it.  Eventually, you’ll lose your land.  However, you might get more money than you anticipated if you try to sell it even with the back taxes owed. If you can’t sell it or if you sell it for less than you paid for it you could get a tax break. If you inherited it you might still get a tax break depending on its value when you inherited it. Typically, losing your property to tax sale won’t affect your credit rating on piece of raw land.  Nevertheless, every County is different, so you should contact the County Tax Assessor to confirm not paying the taxes won’t affect your credit rating with the major credit agencies. Read More

Question:

I purchased a land parcel. The seller gave me a copy of land title named after their parents and we had the Deed of Absolute Sale notarized. Now I am in the process of transferring the land title under my name. The seller agent preparing the title splitting,  but still under the name of the original owner. Should I pay for the splitted title or not? They’re charging me a certain amount for it. Please help me clear my mind on this. What I know is that it is the seller’s obligation to prepare the land title for the land parcel.

Hope anyone can help me.

Answer:

The person selling off the property should first get the title transferred in his name from his parents’ name. If the parents are deceased, then the seller needs to file an affidavit of heirship at the county recorder’s office and get the property transferred in his/her name.   If the parents are still alive, then they will have to transfer the property to the seller and then he/she can sell off the property to you. Typically, it is the seller’s obligation to prepare the land title for the land parcel. Read More

Question: I have a lot I purchased about 10 years ago and want to sell. What types of fees are generally associated with the transaction? I guess we can assume that survey and title insurance are not going to happen give the marginal cost of the land.

Answer:  Typical fees for selling raw land include document preparation fees or attorney fees, recording fees to the County plus any transfer taxes.  Always be certain to verify that there are no back taxes owed on the property so you haven’t agreed to purchase a property that could have several thousand dollars of back taxes owed.  Typically, if you close via a title company this information plus any other liens or encumbrances will be disclosed in the preliminary title report. Read More

Commissions are typically negotiable depending on the brokerage company, value of the property and how motivated the Seller is to sell the property.  6-10 % can be seen in any area.  However, unless the raw land has a higher value, you will be hard pressed to find a motivated realtor to really “work” the listing.  Often, for lower valued property, it’s better to try to sell the property yourself.  Nevertheless, if you want your realtor to be motivated then offering a higher commission will often get them to work harder.  It’s capitalism at it’s finest. Read More

The first designation you want to look for with a land realtor is the ALC (Accredited Land Consultant) Designation. This designation proves they have the knowledge and experience to help you sell your parcel of raw land.  Here is a link to the REALTORS(R) Land Institute (RLI), and a search tool to find ALC credentialed professionals in your area: http://rliland.com/SearchForm.aspx Read More

“Buy on the fringe and wait. Buy land near a growing city! Buy real estate when other people want to sell. Hold what you buy!” -John Jacob Astor

Investing in raw land need not be complicated once you get a solid understanding of the niche as an investment. By being creative, there are a number of ways to make money investing in raw land.  First,  you can make improvements on raw land. Just like with flipping a house, you wouldn’t buy a house and then immediately the next day put that same exact house on the market for $30,000 more. You would improve it. You would install granite countertops, stainless steel appliances, or better fixtures in the bathrooms. You might update the cabinetry, and improve the landscaping of the house. Some improvements can be very expensive. Some can be very inexpensive. A paint job can really improve a home and cost only a few hundred dollars.

Well, the same principles apply to improving land and there’s many different, inexpensive ways that you can improve your property to vastly increase its value without you having to do a whole lot of work yourself and spending a whole lot of money. Read More