What are the Closing Costs Involved in a Land Purchase?


Closing on any real estate purchase involves some type of closing costs. This includes a land purchase. You’ll pay some fees upfront and yet others at the closing. Some fees the seller pays, yet others you are responsible for paying.

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Keep reading to learn which closing costs are the most common for a land purchase so that you can properly prepare.


Surveys aren’t required, but are often recommended. If you want to know the legal description of your property is accurate and that there are no easements or encroachments on the land, it’s well worth your investment. Before you order a survey, check with the seller to see if they already ordered one. Sometimes sellers pay for the survey in order to use it as a selling point, showing buyers that the land is free and clear of any issues.


You’ll need an appraisal if you secure financing for the land. The bank needs to know that the price you are paying for the property is equal to or below its value. If you bid more on the land than it is worth, you’ll have a hard time finding a lender willing to finance the purchase.

Title Fees

You’ll also need a title search on the land. This goes back over the chain of ownership to make sure the land is free for you to buy. It also ensures that there are not any outstanding liens on the property. If you buy a property with liens, they become your issue because the transfer with the property.

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You’ll also need title insurance on the land. The lender will require at least a lender’s policy to help make sure that they are protected should something have been missed in the title search.

Attorney Fees

It’s always a good idea to have an attorney represent you when buying any type of real estate. The attorney makes sure that your best interests are protected. The attorney can review any documents before you sign them and even help you with the purchase contract before you sign it to make sure the terms are fair to all parties involved.

Recording Fees

Every time property exchanges hands, it gets recorded with the county. The county charges a fee to do this, which you pay as the buyer. The fee you will pay is based on the price of the property as well as the length and number of documents being recorded.

Real Estate Taxes

Don’t forget, you will have to pay property taxes on the land. It obviously won’t cost nearly as much as it would if you had a home on the property, but there will still be taxes. You will likely have to pay your portion of the taxes for the bill that will become due and payable within the next 3 months after you close. You may also have to set money aside in an escrow account to account for the taxes.

This is a list of possible closing costs when buying land. Of course, you might pay more or less for the costs, depending on the lender and the circumstances involved in the sale. Always talk to the lender before agreeing to a loan to make sure you understand the closing costs and can afford them. You do have the option to shop around for different lenders to make sure that you get the lowest costs possible.

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