Traditionally, when someone buys a home, they are buying a single-family residence on one parcel of land. However, sometimes the opportunity arises to buy an adjacent property (or properties), which can provide the option for future expansion or to preserve open space.
Farm Credit East specializes in lending to rural areas. Typically, Country Living Loans, Farm Credit East’s mortgage lending arm, offers two options to buy multiple parcels of land. These could be bare land parcels, or properties with existing homes or structures. Read on for considerations that anyone interested in financing multiple parcels should keep in mind.
Buying two adjacent parcels from the same seller
Maybe you’re looking to build your dream home, and two adjacent lots come up for sale. Country Living Loans can finance both parcels under one mortgage. We can finance when you’re ready for construction, too!
The same goes for multiple parcels with homes, garages, barns or other existing structures. If you’re buying from one seller, the process is fairly simple, and often these parcels will be treated as one property on one mortgage.
Using existing equity to buy a second property
A second scenario could be that you already own one property, and the neighboring property comes up for sale. Maybe it’s bare land so this additional property will expand your yard, or it has a garage perfect for your RV.
Country Living Loans can leverage your property equity via a refinance or second-position mortgage to make your dream a reality.
Unique Terms and Conditions of Financing Multiple Parcels
While the process isn’t too different, and utilizing multiple properties can be a terrific way to leverage equity and reduce down payment requirements, there are aspects of seeking loans on multiple properties that can vary.
First is the type of loan you are eligible for. Many lenders consider multiple parcels to be non-conforming to traditional mortgage products, so a specific product may be required.
The second factor is pricing. You may need to pay a higher interest rate when multiple parcels are collateral versus the rate for a standard, single parcel loan.
Every scenario is unique, and products vary widely by lender and location. If you are interested in learning more or have multiple parcels you are looking to purchase or leverage with your equity, reach out to your local Country Living Loans mortgage specialist to see what option is right for you. We specialize in rural lending and look forward to working with you to finance your dream home or property in the country.
Contact your local mortgage specialist for more information at CountryLivingLoans.com.