Federal Deposit Insurance Corporation - FDIC-Insured - Backed by the full faith and credit of the U.S. Government
Federal Deposit Insurance Corporation - FDIC-Insured - Backed by the full faith and credit of the U.S. Government
Looking for your own hunting paradise, a place to ride ATVs, or a quiet spot to pitch a tent by a pond? If you’re eyeing recreational land and weighing it against buying a home, the down payment rules are not the same. Knowing these differences helps you set the right budget and turns your outdoor dreams into reality without surprises.
Recreational land is property meant for enjoying the outdoors, not for building your main home or growing crops for large-scale sale. Think wooded acres for deer or turkey hunting, open fields for building a duck blind, trails for ATVs, or peaceful sites for weekend camping trips. Some folks buy it to fish, bird watch, or just get away from it all.
What makes recreational land stand apart from residential lots? There’s typically no house (yet), no city water or sewer, and no intent to live there full-time. Financing and planning are different from what you’d see with a suburban neighborhood.
Buying a home usually means tapping into classic home loan options with clearer rules, lower rates, and smaller down payments.
Most conventional loans require at least 5 percent down, though some first-time buyers can qualify for as low as 3 percent. Private mortgage insurance (PMI) may kick in with less than 20 percent down, costing you extra each month.
Your credit score, income, debt level, and the home’s price tag all play a part. Stronger finances may get you a lower rate and down payment.
Down payments for recreational land typically run higher than for buying a home. Why? Land is harder for banks to resell if things go wrong, and future use is less certain.
Banks like Town & Country Bank offer flexible financing, including recreational land loans tailored to the needs of hunters, campers, and outdoor enthusiasts. Unique to Town & Country Bank, many of their lenders are also farmers—they understand the land and what makes a great spot for hunting or weekends away.
For an overview of these programs, check out their agricultural lending options that can include recreational land packages.
Expect to put down 20 to 35 percent (sometimes even more) of the purchase price. Raw land without utility hookups or access usually lands at the top end. Land with minor improvements can bring the requirement down a bit.
Lenders consider vacant land higher risk because it’s tough to sell fast if you stop paying. No house means less collateral. That’s why banks ask for a bigger upfront commitment.
Homes are seen as safer collateral. If you default, houses sell quickly. Raw land with no improvements is a gamble, so banks want a bigger buffer.
Recreational land loans often come with shorter terms, higher rates, and stricter requirements. Housing loans can stretch up to 30 years with lower interest.
A 25 percent down payment on a $100,000 hunting tract is $25,000 out of pocket. Compare that to $5,000 for the same-priced home, and the difference is clear. Planning ahead for these larger upfront costs is critical.
Boost your credit score, reduce other debts, and show a stable income. Strong finances can help you negotiate better land loan terms.
Sometimes sellers will agree to a smaller down payment if you pay a higher price or a higher interest rate. Smaller community banks and credit unions, especially those familiar with local land and hunting culture, may also be more flexible.
You can also check out creative ideas tied to agricultural or farm loans and financing that may cover mixed-use or part-time farming land.
When buying recreational land, expect higher down payments and stricter terms compared to buying a typical home. These differences matter—larger upfront costs change how you’ll budget and borrow. Working with banks that truly understand rural land, like Town & Country Bank and its farmer-lenders, keeps the process more down-to-earth. Plan carefully, get your finances ready, and soon those weekend hunting and camping trips can become your new tradition.