What will the bank say?

Question

Okay so I'm 18 and I want to buy a parcel of land I found and have looked at three times, once already with a realtor.

My question is: I want to make an offer on the land, but before I can I need to see if the bank will let me take out a mortgage. Will they? I have never taken out a loan (not a legal one at least, I did borrow $1,500 from my folks once and paid them back every cent of it.) I basically have no credit because I've never taken out anything.

So will the bank let me take out $20,000? Obviously you will NEVER get a credit history if no one will ever let you borrow money because of that fact that you DON'T have a credit history. Will they let me... or will I have to have my parents co-sign? What exactly will happen?

N/A N/A · Answer

When loaning money, the bank wants to safeguard itself as best as possible. They have to know payments are going to be made. Your credit history is a big part of that. If you have no credit, you may indeed need a co-signer.

If you want to help your case, you need to have a definate plan. Show the bank exactly how you are going to make money so that you can pay them back.

Be as thorough as possible. What are you going to do with the land? Are you going to subdivide it and sell it as building lots? Put in an RV Park? What is your plan for operating?

The better you can make your case, the more likely you are to get the loan. And the more likely you are to succeed, too.

Ryan Webber · Answer

Well for starters if you are looking to become an investor, you will need to find ways to build your credit.  Car loan, credit cards, anything that will be reported to your credit report.

Now as for your loan on land, you will be looking at 20% down maybe even 25%, and they may require a co-signor.  There is only one way to find out.  Go talk to a banker.