# Land Loan Calculator: Estimate Land Loan Payments

## Land Loan Calculator

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##### Land Loan Summary

##### Comparing Land Loan Payment Frequency

Payment Frequency | Total Interest Cost | Savings |
---|---|---|

Monthly | $27,278.62 | - |

Quarterly | $27,685.66 | -$407.04 |

Semi-Annual | $28,294.26 | -$1,015.64 |

Annual | $29,504.57 | -$2,225.96 |

##### Comparing Land Loan Term Lengths

Term Length | Monthly Payment | Total Interest Cost | Savings |
---|---|---|---|

30 Years | $536.82 | $93,255.78 | -$65,977.17 |

25 Years | $584.59 | $75,377.01 | -$48,098.39 |

20 Years | $659.96 | $58,389.38 | -$31,110.76 |

15 Years | $790.79 | $42,342.85 | -$15,064.23 |

10 Years | $1,060.66 | $27,278.62 | - |

5 Years | $1,887.12 | $13,227.4 | $14,051.22 |

2 Years | $4,387.14 | $5,291.34 | $21,987.28 |

## About the Land Loan Calculator

This land loan calculator can help those looking for land financing by estimating your land loan payments and creating an amortization schedule. You can also compare different land loan rates and loan terms, such as changing your land loan payment frequency or the term length, to see how it will affect your land loan payments and the total cost of the loan.

In order to estimate your land payments, this land loan calculator uses the following:

**Purchase Price****Down Payment****Interest Rate****Loan Term****Payment Frequency**

This is the cost of purchasing the land lot. Besides the purchase price, you may also need to pay additional costs, such as real estate agent commissions, legal fees, and closing costs.

You will need to make a down payment in order to get a land loan. The minimum down payment required will depend on the type of land that you are financing and your land loan lender. This can range from a 20% minimum down payment to as high as a 50% minimum down payment.

This is your land loan interest rate. The default land loan rate that this calculator uses is 5%. You can customize this to match your own financing situation more closely.

The loan term is the number of years that you will be paying your land loan for. Your land loan payments will be amortized over this period, which means that your land loan will be fully paid off after the end of your loan term.

Payment frequency is how often you will make land loan payments. Common land loan payment frequencies are monthly payments, quarterly payments, semi-annual payments, and annual payments. Your payment frequency choice can affect the total cost of your land loan. For example, making more frequent loan payments can slightly reduce the total interest paid on your land loan.

## Land Loan Calculations

These are the steps to calculating your land loan payment amount:

**Determine land loan amount**The first thing to calculate is the amount of money that you need to borrow. This would simply be the purchase price of the land subtracted by your down payment. The down payment would be paid in cash from money that you have saved up, so you wouldn’t be borrowing the down payment amount.

For example, if your purchase price is $125,000 and you make a $25,000 down payment, then your land loan amount would be $100,000.

**Land Loan Amount = Purchase Price - Down Payment****Find the number of payments**The number of payments you make will depend on your loan term length and your payment frequency. To find the number of payments, you will multiply the number of payments you will make in a year by the term length of your loan in years.

For example, if you make monthly payments, you will make 12 payments in a year. A loan term of 10 years would then be 10 years x 12 payments per year = 120 payments. Similarly, there are four quarterly payments in a year. If you make quarterly payments for 10 years, it would be 4 x 12 = 48 payments.

**Number of Payments = (Number of Years) x (Number of Payments in a Year)****Find the periodic interest rate**Your land loan lender will usually give you a quote for an annual land loan rate. If your payment frequency is not annual payments, you will need to find your periodic interest rate. This can be found by dividing your annual land loan rate by your payment frequency.

For example, if your annual rate is 10%, then your semi-annual periodic rate would be 5% (from 10% divided by 2), your quarterly periodic rate would be 2.5% (from 10% divided by 4), and your monthly periodic rate would be 0.833% (from 10% divided by 12).

Periodic Interest Rate =**Calculate the Land Loan Payment Amount**This will be the amount that you would need to pay on each payment date. To calculate your payment amount, the formula is:

Periodic Interest Rate =Where

found in step 2*n*= Number of PaymentsAnd

found in step 3*i*= Periodic Interest RateFor example, let’s say that your loan amount is $100,000 for a loan term of 10 years at an interest rate of 5%. This means that your total number of payments is 120 and your periodic interest rate is 0.4167%. Using the land loan payment formula:

**Loan Payment**=**Loan Payment**=**Loan Payment**=**Loan Payment**= $1,060.66The monthly land loan payment would be $1,060.66 for 10 years.

**Total Land Loan Payment**Once you have found your loan payment amount, you can now find your total payment amount and the total interest cost of your land loan. Your total land loan payments would be your regular loan payment amount multiplied by the number of payments that you have to make.

For example, if your monthly payment was $1,060.66 for 10 years, then the total loan payments amount would be $1,060.66 x 12 months x 10 years. This gives a total loan payment amount of $127,279.20.

**Total Loan Payments = Loan Payment Amount x Total Number of Payments****Total Land Loan Interest Cost**This would be the amount of interest that you would have had to pay over the entire term of your land loan. This can be found by subtracting the original loan amount from the total loan payments that you have made.

For example, if you made $127,279.20 in loan payments over 10 years when the initial amount that you borrowed was $100,000, then the total interest cost of your loan is $27,279.20.

**Total Interest Cost = Total Loan Payments - Initial Loan Amount Borrowed**

## Current Land Loan Rates

Some land loan lenders post their rates online. However, for most lenders, you will need to contact them for a customized rate. That’s because each land loan purchase is unique and rates can vary significantly based on the location, land type, zoning, acreage, and amount. Below is a list of current land loan rates as of February 2022.

### Members Choice Credit Union

Members Choice Credit Union (MCCU) operates in West Houston, including Katy and Cy-Fair. As of February 2022, you can borrow up to $500,000 to finance the purchase of farming, hunting, or fishing land at a fixed interest rate. Their land loan rates start as low as 6.403% APR for a 10-year term. They also offer balloon payments for their 30/15 year-term.

##### **Members Choice Credit Union Land Loan Rates **

Term | Land Loan Rate (Starting From) |
---|---|

5-Year Fixed | 6.499% |

10-Year Fixed | 6.403% |

15-Year Fixed | 6.537% |

30/15-Year Balloon | 6.837% |

Source: Members Choice Credit Union. Posted rates are as of February 2022.

### Washington Federal Bank (WaFd Bank)

Washington Federal Bank (WaFd Bank) operates in eight states: Washington, Oregon, Idaho, Nevada, Utah, Arizona, New Mexico, and Texas. With WaFd Bank, you can borrow up to $700,000 with a land loan with a maximum LTV of 70% on improved land.

WaFd Bank offers two land loan terms: an interest-only 24 month term and a 20-year fixed rate term. As of February 2022, WaFd's land loan rates for a 24-month interest-only term is 5.75%. For a 20-year fixed rate term, the rate is 5.875%. If you have a credit score of at least 720 and a down payment of 50%, you may be eligible for a discount of 2% off of your land loan rate.

##### **WaFd Bank Land Loan Rates**

Term | Land Loan Rate (Starting From) |
---|---|

24-Month Interest-Only | 5.75% |

20-Year Fixed | 5.875% |

Source: WaFd Bank. Posted rates are as of February 2022.

### Michigan Schools and Government Credit Union

Michigan Schools and Government Credit Union (MSGCU) is only available to residents of Michigan. MSGCU offers vacant land loans for up to $200,000 for land lots of up to 10 acres. As of February 2022, MSGCU's vacant land loan rate for a 10-year fixed term starts from as low as 4.125%, or a 4.730% APR based on a loan of $50,000.

##### **MSGCU Land Loan Rates**

Term | Land Loan Rate (Starting From) |
---|---|

10-Year Fixed | 4.125% |

Source: Michigan Schools and Government Credit Union. Posted rates are as of February 2022.

### Randolph-Brooks Federal Credit Union

Randolph-Brooks Federal Credit Union (RBFCU), a credit union based in Texas, offers land loans for up to 90% LTV (10% down payment), 60-day rate locks, and no building requirements. As of February 2022, their land loan rates start as low as 4.75% for a 4-year term or a 5.365% APR. Mortgage points are also available to be purchased to lower your land loan rate.

##### **RBFCU Land Loan Rates **

Term | Land Loan Rate (Starting From) |
---|---|

4-Year Fixed | 4.75% |

7-Year Fixed | 5.375% |

10-Year Fixed | 5.50% |

15-Year Fixed | 5.625% |

Source: Randolph-Brooks Federal Credit Union. Posted rates are as of February 2022.