Land & Lot Loans in Vermont

Land loans in Vermont give you a way to secure a property now and build when you want.

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4 Best Land and Lot Loans in Vermont

Key Terms

  • Land loans let you secure acreage in Vermont.
  • A lot loan can come with a range of payment options.
  • You won’t need to purchase insurance like you would with a mortgage loan or your property until you build.

Do you love natural beauty, majestic mountain settings, scenic hikes, and some of the best skiing in the East? Chances are Vermont is the place for you. With over 9,217 square miles, according to the United States Census Bureau, the state of Vermont has a significant amount of land on which you can build a new home. 

Why start with land and then build? Buying a home is getting more expensive, even in Vermont. With the value per acre in Vermont at around $7,438.72, per the New Estimates of Value of Land of the United States, land loans can give first-time homebuyers and even those building investment properties an affordable way to secure an ideal location and then build a home to your specifications. 

An added bonus? As you build equity on your Vermont property, you can use it to eventually take out a construction loan in Vermont and finance the next stage of your dream home. 

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What are the main benefits of a land loan in Vermont?

Because vacant land is less expensive than finished houses, you can usually get a larger lot in a desirable neighborhood for a fraction of the purchase price of a home in that neighborhood.

You can also start small and add to your starter home as you go, allowing you to spread the costs of building your dream home over several years while living on the property. Furthermore, unlike so many of the mass-produced homes being built across the country right now, the home you end up with will be unique and your own.

Furthermore, a lot loan in Vermont does not have the same insurance or PMI requirements as a home loan. This can save you a lot of money every month and over the term of the loan. Overall, a land loan can be a very affordable way to begin the process of owning a primary residence.

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4 Best Vermont land and lot loans

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. Vermont State Employees Credit Union

The Vermont State Employees Credit Union serves all of Vermont by providing all types of banking and finance tools to help members meet their goals. They offer a number of loan products to help borrowers attain property ownership, including land and construction loans for buying and building.

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

  • Adjustable rate mortgages available
  • 15-year term loans available on loan amount
  • Prefers working with construction projects
  • The land or lot must pass a perc test
  • Maximum acreage is 25 acres.
  • If you choose to wait and build later, you will pay monthly mortgage payments on the land with a fixed monthly payment for three years and then the rate may adjust annually thereafter.

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. National Bank of Middlebury

The National Bank of Middlebury was founded in 1831 to meet the banking needs of people of west and central Vermont. The National Bank of Middlebury offers a number of banking and financial services to meet customers’ needs, including mortgages,refinancing, small business banking, line of credit accounts, home equity loans, construction loans, and land loans.

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

  • Minimum down payment: 35% for unimproved land, 25% for improved land
  • Fixed rate product only
  • Term is 5-year balloon with a 15 year amortization

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. 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.

4. Union Bank

Founded in 1891, Union Bank has been servicing Vermont and New Hampshire for over 130 years, providing all forms of banking and financing needs for its customers. Union Bank, Inc offers a number of loan options, including loans for land for either raw or improved lots.

To get you the best information, we contacted Union Bank for more details on their land loans and here are the key features and terms:

  • Available for land purchases in northern Vermont or northern New Hampshire
  • Raw and improved land loans available
  • Fixed-rate and adjustable-rate land loan options available
  • Portfolio loans available for large acreage, seasonal-use properties, and other non-conforming properties for which we develop a customized financing plan.
  • Portfolio loans can also help real estate investors purchase a bundle of rental properties.

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 Vermont home land loan make sense for you?

Purchasing real estate is always complicated. There are always pros and cons to choosing a new build that may be smaller, a fixer-upper that may take months to renovate, or a land loan to purchase a vacant lot and build your dream home over time.

If you’re not sure what makes the most financial sense for you, talk to a mortgage broker or finance company that offers all of your options and compare them. There are also various types of land loans available, such as raw, unimproved, and improved land loans, giving you a variety of options.

A land loan is almost always the most affordable and fastest way to acquire property in Vermont. You also don’t have to start building right away, which allows you to develop your project over time and tailor it to your exact tastes and budget. Many people find this process much more enjoyable than living in a fixer-upper while renovations are being completed.

Land loans typically have higher interest rates since they are riskier for lenders. However, most offer various payment options, and as previously stated, you will save money on monthly insurance premiums as well.

Looking for a land or lot loan in a different state?

If you want to find the best land and lot loans in other states, click on your state below.

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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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