Buying Land in Alaska Using a Land Loan

Known as “The Last Frontier,” Alaska has long held the interest of those looking to leave the hustle and bustle of big city life behind in exchange for wild spaces and the opportunity to live rent-free. However, the state’s size, its remoteness and its frontier reputation can make the process of acquiring land for sale in Alaska quite challenging. The vast majority of the state’s property is owned by the federal government, indigenous groups or other parties who are not necessarily interested in selling. Even the land that is available to purchase – mostly through the State of Alaska’s annual, sealed-bid land auctions or through over-the-counter sales – comes with a lot of challenges.

For instance, many available parcels of over-the-counter land in Alaska are “Muskeg,” arctic swamps that require significant infrastructure investment to build on. Other parcels, due to their location, are prone to flooding and/or seismic activity. These are not ideal locations for building homes or business, which is why there are so few platted and developed parcels of over-the-counter land on the market in Alaska.

In addition, the State of Alaska requires all purchasers of over-the-counter land to lease their parcels until they are surveyed and appraised, a process that can take years. This requirement makes over-the-counter purchasing a very expensive option for many people who are interested in the opportunity to own land in Alaska.

A land loan, also known as a lot loan, can be an excellent way for buyers in Alaska to obtain the land they want without paying all cash upfront. A lender will work with a buyer to determine the best land loan program for their needs.

For example, a lot loan might be right for someone who wants to buy a large parcel of land and build a home on it over time as they are able to afford the monthly payments. Another benefit of this type of loan is that it often doesn’t have PMI (private mortgage insurance) requirements.

There are several lenders in Alaska who offer loans on rural properties, and they will work with you to find the best program for your unique circumstances. These types of lenders understand that these are high risk borrowers, and they will take the time to evaluate your financial status in order to provide you with the most competitive loan program.

Company buying Alaskan land will often be willing to buy your land for cash. This is a great option if you are looking to sell quickly and avoid the hassle of inspections, appraisals and a lengthy closing process. In addition, a “we buy land” company is usually able to close more quickly and with less paperwork than a typical retail buyer. In many cases, the transaction will be completely tax-free for you. This is because most Alaskan lands do not include mineral rights and are therefore exempt from property taxes. However, it is important to check with a title company and an attorney before purchasing to determine the current mineral rights status of your property.

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