Red Deer Land Mortgage | Land Mortgage Red Deer  | Land Loan
Red Deer Land Mortgage | Land Mortgage Red Deer  | Land Loan

What You Need to Know About Mortgaging Land in Red Deer


Buying land is often the first step to getting your dream home, since you can build your dream home whenever you want with a construction draw mortgage (or have the money). In some cases, people buy land to build their home on today, while others buy land in the hope they’ll build a retirement home on it later. You can buy land as an investment you could sell later.

You can’t insure land the way you can a house with CMHC as they are for residential mortgages which require a home. This means that you have to put at least 25% down to buy land and they come with a higher rate as it is an open mortgage. Talk to Red Deer Whalen Mortgages your Red Deer mortgage broker to understand your options for securing a mortgage on land.

Fully serviced land has municipal water, sewer, gas and electric service. As soon as you build a home, you can connect to the utilities. This is called a serviced lot. When you buy a lot in an existing urban area, it is almost always fully serviced. The only exception is if the property isn’t zoned residential – most home mortgage lenders want the property to be zoned residential before they’ll extend a residential mortgage. If you want to build an office building or mixed used development, you’ll probably need to consult with a commercial lender.

A partially serviced lot has power and natural gas but not water and sewer. Not fully serviced land doesn’t have any of these services, but power and natural gas service ends at the property line. When doing a construction draw to service the lot the builder would include these costs to the building quote. 

If you want to buy a large acreage, expect to put at least 25% down. Depending on the location of property you may have to put even more down due to marketability concerns. If you plan to build a home we can do the land purchase and new build contract at the same time and the money put down on the land can count towards the new home down payment and may not require more money put down on the new home build. 

Call Red Deer Whalen Mortgages today 587-315-3525 to consult with a Red Deer mortgage broker so that you can find the cheapest land mortgage possible or apply online today.