Buying land, input needed

[hunts_with_stick]

Need some input, 12 acres, very nice area, appears to be developing. Has 2 years left on an Encino lease that pays 5K a year to run water through the property. Nice barn on it. Appears to be a nice little cabin, no electric or water. Looks to have a stoves. Probably 5 acres field, 7 wooded. Deer sign. Would potentially need to take a small loan, 30k or so. Do I do a heloc? Home is paid off. Only two small car loans. What’s the best way to go? Any input is appreciated

 

[hunts_with_stick]

Oh, the only reason for the car loans is .9 and 1.9 financing.

 

[gjs4]

What is an Encino loan? Very similar position here and did a HELOC at 8.5 12/22....zero regrets and i dont have hunting/habitat in order at all

 

[hunts_with_stick]

an energy company. Good to hear about the heloc. What is 12/22? I just hate borrowing money:(

 

[T-Max]

I’m gonna guess December of 2022.


Sent from my iPhone using Tapatalk

 

[Jerry-B-WI]

How much equity do you have in either vehicle? I had used a vehicle for collateral on a loan to finish my cabin. No appraisal fee and no closing costs. Saved me a bunch.

 

[hunts_with_stick]

Tons of equity. But not as much as in the house. House is paid off.

 

[SD51555]

Need some input, 12 acres, very nice area, appears to be developing. Has 2 years left on an Encino lease that pays 5K a year to run water through the property. Nice barn on it. Appears to be a nice little cabin, no electric or water. Looks to have a stoves. Probably 5 acres field, 7 wooded. Deer sign. Would potentially need to take a small loan, 30k or so. Do I do a heloc? Home is paid off. Only two small car loans. What’s the best way to go? Any input is appreciated

1. I'd do a 401k loan for something like that if you have the option. Rates on a 401k loan are high right now, like 10%, but you keep the interest in your plan and it doesn't go into the scumbag banking system. The market is topped out right now anyway. You'd be swapping cash from one pocket to the other, but it'd stay in your pockets. Then you don't have a lien on any of your property.

2. Cash value life insurance loan if you have that. They can have attractive rates better than a bank (depending on the policy).

3. HSA distribution if you happen to be one of those that saved it and didn't use it. You can take a cumulative tax free distribution for years of medical expenses if you paid them out of pocket and never reimbursed yourself.

4. Look at your toys and vehicles collection. Might be time for a garage sale and turn that unused stuff into land. I paid for most of my Can Am just by cleaning out the gun safe.

 

[bwoods11]

Go for it !

 

[rocksnstumps]

1. I'd do a 401k loan for something like that if you have the option. Rates on a 401k loan are high right now, like 10%, but you keep the interest in your plan and it doesn't go into the scumbag banking system. The market is topped out right now anyway. You'd be swapping cash from one pocket to the other, but it'd stay in your pockets. Then you don't have a lien on any of your property.

2. Cash value life insurance loan if you have that. They can have attractive rates better than a bank (depending on the policy).

3. HSA distribution if you happen to be one of those that saved it and didn't use it. You can take a cumulative tax free distribution for years of medical expenses if you paid them out of pocket and never reimbursed yourself.

4. Look at your toys and vehicles collection. Might be time for a garage sale and turn that unused stuff into land. I paid for most of my Can Am just by cleaning out the gun safe.

401k loan is decent option if you have job security. The risk with those type of loans, you lose your job and same time have to pay back the loan as that 401k with old company has to move. Small risk for most maybe but something to be aware of.

 

[Howboutthemdawgs]

I did a heloc to pay for a portion of a tract that I wanted. I hate debt but it was the only way I could swing it and since it was already open we didn’t have to pay closing costs another time if we financed a different way.

 

[SD51555]

401k loan is decent option if you have job security. The risk with those type of loans, you lose your job and same time have to pay back the loan as that 401k with old company has to move. Small risk for most maybe but something to be aware of.

Some of them you can keep in force after you quit. I had one when I left my last two jobs and I was able to keep the loan going after I separated from the company. Not a bad idea to check plan rules just to be sure.

 

[hunts_with_stick]

Great idea about the 401k loan, ty

 

[Tree Spud]

I'd use the water rights lease money to pay off the loan. I hate debt as it can lead to living beyond your means, so you need to make sure you still have cash reserves.

You could try land contract where the seller might allow for lower interest rate depending how much you put down.

 

[hunts_with_stick]

That's what I was thinking about the water rights as well.

 

[b116757]

I’d use 401k loan if available to you first then heloc as the second choice.

 

[hunts_with_stick]

how much value does a quonset style barn add to a property. It doesn't look the best of shape (I will be checking it out today) Also, there is a lot of junk on the property - random pieces of equipment (that appears to not work) and other junk around. And there appears to be a lot of old wood ,hoses, broken shutters, ladders, 50 gallon oil drums (empty) and what not in the barn. If they leave a very old looking tractor (assuming it works) is that worth anything? Any input is appreciated with this information.

 

[Maddog66]

My wife and I bought appx 300 acres with 1/2 cash and the other half being a Heloc loan in 2020.

The key decision for us was the agreement that we were going to belt tighten on everything else and hammer the loan out as fast as possible.

We’ve made triple and quadruple monthly loan payments over the past 3.5 years and it will be retired by this September.

In all honestly, it hasn’t been easy but you do get used to it after awhile.

Our land had a crappy dirt floor shed without electricity. It was ugly as sin!

So we cleaned it up, poured a concrete floor, painted it and ran in electric. It cost about $20k and lots of time, but so worth it.

 

[hunts_with_stick]

Good to hear

 

[b116757]

Quonset huts are not cheap to buy new depending on size and if it has a concrete floor or not. Just the quoset could be anywhere from $8,000- $30,000 in materials depending on size and condition I personally don’t care for their look either but they are pretty good low maintenance dry storage wish I had a couple of them myself. Last farm I bought had 5 old barns a plumbed shower/toilet shed and a very old decrepit house. We burned down the house and have been slowly fixing up the barns because it’s much much cheaper on property taxes and repairs versus replacement with new construction. Building anything has gotten very expensive wish I’d of built another machine shed a few years ago pre-Biden inflation but that boat has sailed.