6 Best Land and Lot Loans in Massachusetts


Land loans give you a way to build a home in Massachusetts on your own terms.

Key Terms

  • Land loans let you secure land and build later, if you like.
  • Also known as lot loans, land loans have no requirements on when or if you build.
  • These loans don’t have insurance requirements as mortgages do.

Massachusetts has a lot going for it, from the charm and history of Boston to the lovely Berkshire mountains. It’s also a key part of the Eastern Seaboard and New England, making it a great location for professionals who want the quality of life that comes with living in New England. According to the United States Census Bureau, Massachusetts has 7,801 square miles of land, offering more than enough space for those trying to find a place to live in the Bay State.  

Anyone looking for a home in Massachusetts is faced with some pretty competitive markets these days, however.  With the value per acre in Massachusetts at $102,214.31, per the New Estimates of Value of Land of the United States, residents of the state might find that buying a parcel for a home and then building their own home is a more affordable option.

Massachusetts land loans, or lot loans, are a bit different from construction loans in Massachusetts. Construction loans are great if you are doing a renovation or want to build right away, but a lot loan gives you a bit of time and allows you to do what you want, when you want with your new land. 

Benefits of getting a land loan in Massachusetts

Typically, when looking for a home, you look for one that has already been built. However, with property prices as high as they are in the United States and Massachusetts, you may find that your “perfect” home is out of reach.

Usually, this means settling for something smaller or in worse condition, but there is an alternative available. People who want to buy property but can’t find or afford their dream home can use a land loan to purchase a vacant lot and build on it later.

That means that, for one, you don’t have to settle. It also means that you might be able to afford a place in a more expensive neighborhood than you previously thought. Finally, land loans are great options for those looking to build retirement homes or vacation homes. 

6 Best Massachusetts 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. Rockland Trust

Rockland Trust is a full service bank that offers services for its members in Rhode Island and Massachusetts and has been doing so since 1907. Rockland Trust offers a number of construction and land development loans, including commercial real estate construction, land acquisition and development, and builder financing.

We asked Rockland Trust for more details on their vacant land loan product and here is what they said:

  • Available for commercial projects in Massachusetts and Rhode Island
  • Commercial Real Estate Construction Loans: Build retail stores, office buildings, industrial or manufacturing plants, apartment complexes or mixed-use projects.
  • Land Acquisition and Development Loans: Purchase residential or commercial land, as well as develop the infrastructure and single-family or commercial improvements that go with it.
  • Builder Financing: Construct single-family homes, condominiums, subdivisions and short plat developments.

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. Webster First Federal Credit Union

Webster First Federal Credit Union was founded in 1928 and now serves the Webster, Douglas, Dudley, and Worcester areas of Massachusetts by providing financial services for its members. Webster First Federal Credit Union provides a number of loan products to help customers secure property and homes, including land loans.

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

  • Terms available from 1 – 10 years
  • Finance up to 75% of the purchase price
  • No prepayment penalties
  • Can convert to a construction loan at a later date if desired

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. BankFive

Incorporated in 1855, BankFive is one of the many SouthCoast independent community banks offering land and lot loans to potential homeowners. With 13 full-service branches and 4 lending offices in Massachusetts and Rhode Island, it is no surprise that BankFive offers a land and lot loan program for potential homeowners in the region. 

We asked BankFive for more details on their land loan product and here is what they said:

  • Land and lot loans available for land and lot purchase for both investors and homeowners
  • Offers Construction loans for the typical home-building process 
  • Rehab Loans available for financing fixer-upper and renovations

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

4. TD Bank

TD Bank is a full service bank that offers all types of financial products, including investments, wealth planning, and private banking services. TD Bank does have a large lending ability in which loans can be obtained for property and land purchases and the purchase and renovation of a home.

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

  • Can finance land purchases as part of construction project
  • Construction loans are interest-only during the construction phase

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. BayCoast Mortgage

BayCoast Mortgage Company provides mortgage services in New Hampshire, Massachusetts, Rhode Island, Connecticut, Pennsylvania, New Jersey, Maryland, Virginia, North Carolina, South Carolina, and Florida. BayCoast Mortgage is a full service mortgage company that offers a variety of mortgage products for everyone’s needs.

We reached out to BayCoast Mortgage to discuss land loan details, which you can read about below:

  • Loan payments spread out over a 20 year term.
  • 5/1 ARM – Fixed interest rate for the first 5 years then adjusts up or down every year thereafter.
  • Minimum required down payment of 20% of the land value.

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

6. Alltrust Credit Union

Founded in 1922, Alltrust Credit Union has more than 100 years of providing services to residents. It is one of the largest credit unions in the state. Among the loan offerings and bank services provided are land loans designed for the acquisition of buildable lots within the region.

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

  • Purchase or refinance available.
  • 15 and 10 year fixed terms available.
  • Lot must be buildable.

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 Massachusetts home land loan make sense for you?

A land loan makes a lot of sense if you want to get on the property ladder in a desirable neighborhood or buy a piece of land to turn into your dream holiday home. Raw land loans, unimproved land loans, and improved land loans are all options to consider.

If you need a new home that is move-in ready, a land loan is not the right fit, and you may want a mortgage loan from a traditional lender. If you find a good piece of land through the NMLS, you might be able to look into all loan options for your home purchase to build your dream home on your own land. Once you know the loan terms like your monthly payment and interest rates, you might realize you can get a lot with a land loan.

A land loan allows you to secure the land you want before finalizing all of your construction plans, giving you time to fine-tune your design to perfection. A land loan gives you options that the traditional mortgage route does not, which is usually a take it or leave it situation. Not all borrowers will like the loan terms for a land loan, but if you want a primary residence you’re proud of, you may need to look outside of home equity loans or lines of credit to make your purchase possible.

If you’re looking into alternative options like land loans, adjustable rate mortgages, jumbo loans, or home construction, don’t forget to include land loans in your research. With so many types of loans out there, it’s helpful to know the underwriting and application process for each one in advance.

Is there a disadvantage to land loans? They may require a substantial down payment. The benefits of building your own custom home on your own timetable, on the other hand, may make this one inconvenience worthwhile. You will also save money on insurance because land loans do not require the same insurance or PMI as mortgages.

So, if you can’t find what you’re looking for in the housing market, perhaps it’s time to do it yourself.

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.

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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