How to Get Funding to Buy Land in 2026

Getting funding to buy land is the number one challenge land investors face. Banks don't want to lend on raw acreage. Conventional mortgage programs don't apply. And most investors don't know what options actually exist beyond going to their local bank and hoping for the best.

This guide covers every realistic way to get funding for a land purchase in 2026 — what works, what doesn't, and which option fits your situation.

Why Land Funding Is Different

When you buy a house, there's a well-established system: you get pre-approved, make an offer, the bank appraises the property, and you close in 30-45 days. None of that exists for vacant land. There's no Fannie Mae program for raw acreage. There's no standard land mortgage. Most banks have no process for it at all.

That means land buyers need to look beyond traditional financing. The good news is there are more options than most people realize — some of them better than a bank loan.

Option 1: Private Land Lenders

A private land lender is a company that specializes in funding vacant land purchases. Unlike banks, private lenders understand raw land, move quickly, and make decisions based on the deal — not just the borrower's credit score.

Private land loans typically close in 7-14 days. Rates run 12-16% with interest-only payments. Down payments are usually 20%, though some lenders offer 100% financing through cross-collateralization or equity partnerships.

This is the go-to option for serious land investors because it solves the two biggest problems: speed and certainty. When you have a deal under contract with a 30-day closing window, you can't wait 60 days for a bank to decide.

Option 2: Seller Financing

Seller financing is one of the most common ways to buy vacant land. The seller acts as the lender — you make a down payment, sign a promissory note, and pay monthly. Rates typically range from 8-12%, and terms are negotiable directly with the seller.

This works especially well for land because so many sellers have properties sitting on the market for months or years. Offering to buy with seller financing gives them a sale they might not otherwise get, plus ongoing monthly income.

The downside for investors is that your capital stays locked up in monthly payments instead of being available for the next deal. That's why many investors use seller financing to sell properties, then sell the resulting note to a note buyer like Damen Capital for immediate cash.

Option 3: Joint Venture Equity + Debt (100% Financing)

This is the strategy most investors don't know about. A JV equity partner puts up the down payment (typically 20%) while a private land lender provides the remaining 80% as a loan. The result: you acquire land with zero cash out of pocket.

You bring the deal and manage the execution. The JV partner provides equity capital. The lender provides debt. When the property sells, the lender gets repaid, the JV partner gets their capital back plus a profit share, and you keep your share — all without investing your own money.

At Damen Capital, we can provide both the debt and connect you with JV equity partners. Learn how debt + equity financing works →

Option 4: Cross-Collateralization (Zero Down)

If you already own land or other property with equity, you can use it as additional collateral to get 100% financing on a new purchase. No down payment required — the lender places a lien on your existing property alongside the new acquisition.

When the deal is done and the loan is repaid, the lien on your existing property is released. It's a way to leverage assets you already have to grow your portfolio without tying up cash. See how cross-collateral financing works →

Option 5: Local Banks and Credit Unions

Some community banks offer land loans, especially in rural areas. Rates are the lowest — usually 7-10% — but the trade-offs are significant: 30-50% down payment, 30-60 day closing, full income documentation, credit score requirements, and a property that fits the bank's narrow criteria.

For long-term holds where you have time and excellent credit, bank financing can work. For active investors who need to close fast, it rarely does.

Option 6: Home Equity (HELOC)

If you own a home with equity, a HELOC gives you a line of credit at rates lower than a land loan — because it's secured by your home, not the land. This works for smaller purchases where the total amount stays well within your comfort zone.

The risk is real: your home secures the loan. If the deal doesn't work out, your primary residence is on the line.

Option 7: Hard Money Lenders

Hard money lenders focus on real estate but many don't lend on raw land — they prefer properties with structures. The ones that do fund land deals typically charge 12-18% plus 2-4 points upfront. Terms are short (6-12 months) and fees add up quickly.

Private land lenders like Damen Capital are generally a better option because we specialize in land, charge no points, and offer longer terms with more flexibility.

Which Funding Option Is Right for Your Deal?

Next Steps

The right funding depends on your deal, your timeline, and your capital situation. If you need to close fast with flexible terms, a private land loan is usually the best fit. If you want zero out of pocket, explore cross-collateralization or JV equity + debt structures.