5 Best Land and Lot Loans in Illinois


Illinois land loans give aspiring homeowners an easier way to achieve the home of their dreams.

Key Terms

  • Land loans let you secure land now and build when you want.
  • Also known as lot loans, land loans can offer flexible payment options.
  • These loans don’t have insurance requirements.

With some 55,513 square miles of land, according to the United States Census Bureau, Illinois is one of the most varied states in the Midwest. You can enjoy real, “big city” living in Chicago or the charm of rural life across all those many miles. Illinois also has some of the best universities and hospitals in the U.S., sweetening the deal. 

Yes, Illinois has got everything you could need, but finding the right home is getting more difficult. Prices are going up, and many of the new builds are either cost-prohibitive or just not the type of home you are looking for. Many are turning instead to land loans, which allow you to secure the land you want and eventually build your own home.  With the value per acre in Illinois at $23,491.92, per the New Estimates of Value of Land of the United States, Illinoisns definitely have options when it comes to finding an affordable lot for a home. 

Land loans are a great alternative to construction loans in Illinois, since they allow you to build at your own pace. When you do want to build, the equity you’ve built in your land can even help qualify you for a construction loan. 

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Benefits of getting a land loan in Illinois

Buying a house is a pricey endeavor. This is especially true when purchasing a turn-key, move-in ready, or new construction home. You could buy a fixer-upper, but that means months and sometimes years of costly refurbishments and additions.

The other option is to reduce your ambitions and settle for what is available in your price range. None of those options sound appealing, which is why many people prefer to purchase vacant land instead.

Building a home yourself is often significantly less expensive than purchasing a pre-built home. You will also have complete control over the style, layout, and design of your home if you construct it yourself. You can also postpone your construction until you have the funds to build the home of your dreams.

Simultaneously, once you’ve guaranteed the lot with a land loan, you can take your time; if the price of the property rises while you wait to build, it will only benefit you by building equity. 

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5 Best Illinois land loan lenders

Some lenders only offer land loans for residential projects, while other programs can lend to those that are pursuing recreational or agri-business purchases.

1. Town and Country Bank

Located in Illinois, Town and Country Bank provides banking services for Springfield, Lincoln, Jacksonville, Quincy, Fairview Heights, Decatur, Bloomington, and Edwardsville. Town and Country Bank offers a number of loan products for its customers, including land loans, lot loans, mortgages, and bridge loans, among others.

We asked Town and Country Bank for more details on their vacant land loan product and here is what they said:

  • Available as a short-term or long-term loan.
  • Requires: A building permit, residential zoning, utility connections, clearly marked boundaries and a recent survey and access to public roads.
  • No prepayment penalty
  • Local decision-making and processing

When you’re ready to connect with a loan officer, use our form to quickly match with land and lot loan programs based on your specific circumstances.

2. Citizens Equity First Credit Union 

With over 360,000 members, Citizens Equity First Credit Union provides a wide range of financial tools to its members. It was founded in 1937 with the goal of providing an open approach to banking. This full-service bank offers construction and permanent loan options with rate lock features.

We reached out to Citizens Equity First Credit Union to discuss land loan details, which you can read about below:

  • Mainly aimed at people who plan to undergo immediate construction projects.
  • Close within 60 days of application.
  • Make interest-only payments for up to 12 months.
  • Pay interest only on money used during construction.

When you’re ready to connect with a loan officer, use our form to quickly match with land and lot loan programs based on your specific circumstances.

3. First Bank of Manhattan

The First Bank of Manhattan first opened in 1907 with just $40,000 in assets. It grew over time and now manages over $220 million in assets and continues to offer services to those in Manhattan, Elwood, and New Lenox. It offers construction and lot loans for residential and commercial development.

We asked First Bank of Manhattan for more details on their vacant land loan product and here is what they said:

  • Finance the purchase of undeveloped lots
  • Fixed rates
  • Refinancing options available
  • Construction loan products also available

When you’re ready to connect with a loan officer, use our form to quickly match with land and lot loan programs based on your specific circumstances.

4. Midland States Bancorp

Based out of Illinois, Midland State Bancorp offers a number of products and services to help to meet the needs of its members and customers. Some of the products offered by Midland States Bancorp, Inc include construction loans, land lot loans, and many other services.

We reached out to Midland States Bancorp to discuss land loan details, which you can read about below:

  • Lot loans available to purchase property before you begin construction.
  • Construction loans available for short-term loan you can use to finance the construction of a new home.
  • Local decisions and processing.

When you’re ready to connect with a loan officer, use our form to quickly match with land and lot loan programs based on your specific circumstances.

5. Citizens Bank & Trust

Based in North Alabama, Citizens Bank & Trust provides a number of services for those living in the area and looking to invest in property. Citizens Bank & Trust offers land loans and construction loans to help with the purchase of property as well as the building on property.

We reached out to Citizens Bank & Trust to discuss land loan details, which you can read about below:

  • Available for home construction or land
  • Available for primary residence or secondary home construction
  • Draw system: funds can be disbursed in stages as construction progresses
  • May roll into permanent loan, saving on closing costs
  • Local decision-making and processing

When you’re ready to connect with a loan officer, use our form to quickly match with land and lot loan programs based on your specific circumstances.

Does a Illinois home land loan make sense for you?

IIf you’re having trouble meeting the demands of the housing market in Illinois, or you simply can’t find the property you desire in the spot or neighborhood you want, a land loan may be the solution for you. If you want move-in ready real estate, then home loans for land may not be the right fit for you. If you do your research with a lender, though, verify through calculators and conversations what your down payment, interest rates, and credit scores must be for your land purchase loans to get approved.

If you already explored eligibility for a mortgage loan or big loan amount through hard money loans, but this is a better fit, a farm loan or land loan in Illinois may be the next thing to check out. Loan rates and the loan process can vary, so verify that you’re getting competitive rates and a good monthly payment for any loan you plan to take out for building your dream home.

These loans enable you to secure the most important piece of the equation – the property itself – while you work out the remaining details. With property price increases expected to continue for the foreseeable future, this could save you a lot of money in the long run.

Land loans are also ideal for financing retirement homes, second homes, or the vacation home of your wildest imagination. If you’re looking for a different way to get the house you want in Illinois, this could be it.

If you’re looking to explore land and lot loans in other states, check out our national overview of land loans as a starting point in your search.

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Joshua Holt

Joshua Holt is a licensed mortgage loan originator (NMLS #2306824) and founder of Biglaw Investor. His mortgage expertise lies in the areas of professional mortgage loans, particularly for lawyers, doctors and other high-income professionals. Prior to Biglaw Investor, Josh practiced private equity mergers & acquisition law for one of the largest law firms in the country.

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