Skip to main content Skip to main content

Apply for a Personal Land Loan to Buy Property in Texas

February 7, 2024

When searching for the best places to buy land in the U.S., Texas is at the top of the list (according to sources such as Land City and Yahoo Finance). Our state’s strong economy, a wide range of property options, and lack of state income tax make Texas an ideal place for individuals to acquire property for personal or investment use.

The key is selecting the right type of financing option for your specific land needs. For example, a personal land loan might be the right choice for your needs.

Learn about the process of applying for a loan to acquire property in Texas, and why you should choose Texas Gulf Bank to help you secure the financing you need.

Why Consider a Personal Land Loan?

Finding the perfect property to acquire in Texas can be easy, but choosing the right financing option for your purchase may be challenging, especially with so many loan choices available. A personal land loan is a type of financing option that uses real estate as collateral to support your qualifications for financing.

Typically, a personal land loan is used in two different types of situations:

  • Acquiring a residential lot inside city limits – with utilities available to tie into the property.
  • Purchasing residential rural acreage, outside of city limits with no utilities. It could be cleared or wooded in a residential area (e.g. raw land).

Let’s take a closer look at both of these typical scenarios to provide you with insights into how the financing process works.

Personal Lot Loan – Residential Lot Purposes

Using a personal lot loan to purchase a residential lot within city limits – where city utilities are readily available – presents a unique opportunity for prospective homeowners or investors.

One of the most compelling benefits of this scenario is the relative ease of development. With city utilities like water, sewage, and electricity already in place, the process of turning the lot into a livable space is significantly streamlined.

When starting the process of obtaining financing in this scenario, it’s important to have an end goal in mind. Our lenders will want to assess the purpose of the purchase, so we’ll start by discussing your goals. Are you planning to build a home, hold onto the land as an investment, or something else? Understanding your goals will help us tailor a loan to fit your unique needs.

Personal Lot Loan – Rural Areas

Opting for a personal land loan to acquire residential rural property outside city limits is a venture brimming with potential. Our loan process is designed to support your vision, offering flexible terms that recognize the unique nature of rural property investments.

Whether you’re seeking a peaceful getaway or a permanent shift to country living in Texas, we’re here to support you on the journey. Again, our lenders will want to assess your intent so that we understand exactly what you want to accomplish through a personal lot loan.

For example, land loans are intended for buyers who want to purchase land but have no immediate plans to build or develop on their lot. The application process will include evaluating property lines, local zoning laws and usage restrictions, and access to utilities and roads.

Borrowers interested in a land loan have three loan options to choose from:

  • Raw land loans – no utility or road development on land
  • Unimproved land loan – a slightly more developed plot of land with utility and road access
  • Improved land loans – lot with full road and utility development

Purchasing raw land or unimproved land will typically require borrowers to provide more detailed plans for future land use as part of the loan review process. The intent is demonstrated through a down payment. At Texas Gulf Bank, we typically require a 25% down payment for a lot loan and 35% for raw land.

Texas Gulf Bank: We Offer Personal Land Loan Solutions

Texas Gulf Bank has proudly served customers in the Southeast Texas Gulf Coast region for over 110 years by providing reliable and strategic loan options. We offer a wide variety of financing solutions to help customers achieve their real estate goals.

The process of applying for a personal land loan through Texas Gulf Bank begins with an initial consultation with our lenders to discuss your specific loan needs.

We take the time to get to know you and understand your specific needs. We also review exactly how funds from your loan will be used, your current financial standing, loan terms, and available income sources for repayment.

You will be required to submit documentation including but not limited to:

  • Completed Consumer Loan Application.
  • Federal Tax Returns for the past two years and W-2s upon request.
  • A current pay stub showing year-to-date earnings.
  • An executed earnest money contract for the purchase of the land from the seller.
  • Two forms of IDs (Texas Driver’s License, passport, or Social Security card).
  • Detailed plans for loan funds.
  • Land information (location, cost, lot condition).

Once submitted, our in-house loan team will promptly review all documentation to determine viability. When real estate is the collateral involved in a loan, we can typically offer longer repayment terms, which may help lower your monthly payment amounts.

If you are approved for financing, loan funding may be expedited so you can make your land purchase as soon as possible.

Contact a Lender to Discuss a Personal Land Loan

When you find the ideal real estate to purchase, you want to be able to take action as soon as possible. Texas Gulf Bank may be able to help you secure a personal land loan to support your real estate goals.

Contact a lender today via email or telephone to schedule a consultation about your intentions. Or, visit any Texas Gulf Bank location to get started on the lending process. We look forward to partnering with you to make your dream of land ownership a reality.

All loans subject to credit approval.

Interested in a complimentary
consultation with one of our bankers?