Land Loan Calculator

Land Loan Calculator

Land loans finance vacant lot purchases with terms that differ from traditional mortgages.

What This Calculator Shows

• Monthly Payment: Your expected payment amount based on loan terms
• Total Interest: The cost of borrowing over the loan lifetime
• Amortization Schedule: How payments split between principal and interest
• Payment Breakdown: Visual representation of your loan costs

How to Calculate

1. Enter your loan amount 2. Input the interest rate (APR) 3. Select the loan term 4. Review your payment details and total costs

Key Considerations for Land Loan

• Compare offers from multiple lenders before committing
• Understand all fees including origination, closing costs, and prepayment penalties
• Consider how rate changes might affect your payments (for variable rates)
• Factor in your overall financial goals and debt-to-income ratio

Raw land is the hardest residential collateral there is: it produces no income, cannot be lived in, and sells slowly in a downturn. Lenders price accordingly.

Land type	Typical down payment	Rate premium over a mortgage
Improved lot (utilities, road)	15–25%	+1%
Unimproved	25–35%	+1.5–2%
Raw / rural acreage	35–50%	+2–3%

Terms are shorter too — often 15 years or a balloon at 5 — which pushes the payment up independently of the rate. If you intend to build, a construction-to-permanent loan that includes the land purchase is usually cheaper than buying the land separately and financing the build later.

The Numbers This Page Opens With

The calculator above starts at $100,000 over 15 years at 8%, which is representative for this product:

Monthly payment	$956
Total repaid	$172,017
Total interest	$72,017
Interest as a share of principal	72%

Change any input above and every figure recalculates. The amortisation formula behind it:

`` M = P × [ r(1+r)^n ] / [ (1+r)^n − 1 ]

P = principal, r = monthly rate (annual ÷ 12), n = number of payments ``

Before You Sign

• Compare APR, not the rate. APR includes origination and points; the rate does not.
• Ask about prepayment penalties. They turn a plan to pay early into a fee.
• Rate-shop inside 14 days. Credit scoring models treat multiple mortgage or auto

enquiries in that window as one enquiry.

• Check whether the payment includes escrow. A mortgage quote without taxes and insurance

understates the real monthly cost by hundreds.

Where the Money Goes

On $100,000 at 8% over 15 years, paying $956 a month:

Point	Principal repaid	Interest paid	Balance
Year 2	$5,507	$11,694	$94,493
Year 4	$15,107	$27,897	$84,893
Year 8	$35,480	$50,529	$64,520
Year 11	$62,953	$66,060	$37,047
Year 15	$100,000	$72,017	$0

Early payments are mostly interest. That is not a fee structure — it is arithmetic: interest accrues on the outstanding balance, which starts at its largest. It is also why an extra payment made early saves far more than the same payment made late.

What a Rate Change Costs

Rate	Monthly	vs 8%	Total repaid
7.00%	$899	-$57	$161,789
7.50%	$927	-$29	$166,862
8.00%	$956	—	$172,017
8.50%	$985	+$29	$177,253
9.00%	$1,014	+$59	$182,568

Half a percentage point moves the monthly payment by $29 and the total by $5,236. Shopping three lenders usually beats any amount of negotiating on price.