A Step-By-Step Guide for Buying Land Using Cash

If you are ready to build your dream house, the first thing you need to do is purchase a plot of land. If you wish to reside in a planned community, then you can easily buy preassigned lots. However, if you are hoping to build a home in a rural spot, then it is up to you to purchase land and decide how much space you will need.

Paying with cash for land has a ton of advantages. You can negotiate more easily and you also do not have to wait for approvals and added paperwork. Deals can be closed sooner and soon you will be able to own a plot without owing money to anyone. The real question is: how to buy land from a private seller using cash? We have put this step-by-step guide together to help you out.

Search for the Right Land and Location

If you are sure about purchasing land and do not know what location you would like, then an online search as the starting point can be beneficial. Searching online gives you an idea of land sizes, prices, and locations.

This will help you make up your mind on what location will be most suitable for a family property or other construction. If you do not like the idea of narrowing down to the right location on your own or are not confident enough, then speaking to a real estate agent is your best bet.

However, bear in mind that agents do charge a fee for any deals that they help you complete successfully.

Research Well Before Investing

If you find a suitable location and piece of land, the first step should be to look into the state, town, or county zoning laws. These are rules the government expects home builders and landowners to follow when they do start building on an empty piece of land.

You will face hefty fines and penalties if you break these laws or cause damage to the construction. Examples include knowing whether your land is allowed subdivision or how tall your home can be. Zoning laws and regulation information can be obtained from county, city, or government offices. A real estate agent can also help you in getting this information and can guide you well as they are already aware of most laws and rules. Some basic zoning restrictions include:

  • Business type and whether it is allowed
  • Building type
  • Utility line placement and location
  • Height and size of the building

Apart from restriction, it is also very important to know whether you will require land permits. You will require permits for the following:


Electrical connections or connections to public water lines require permits.


Oftentimes, sewer capacity may not be sufficient for connections especially when you decide to build a property on a plot of land. You will require permits to alter the sewage system. If the nearest sewer line is too far away, your best bet is to opt for a private septic system.

Road access

Costs to build a road through a piece of land may vary greatly and whether this is allowed is dependent on the local government. In some cases, they may not allow construction at all.

Any trees that may be present on the land will have to be cleared before roads or any other type of construction is started. Lands near conservation properties or those housing endangered animals often won’t allow or limit construction work.

Make an Offer

A cash offer means you will require a few documents. You will need proof of funds so that a seller feels comfortable knowing you are capable of making a down payment. An official letter from a bank with the account holder’s name, date, and fund data should be sufficient. You may also need a bank statement or account balance copy.

You will also require a real estate contract with all details, agreements, and payments listed clearly before a deal is finalized. You can find a bid offer form online or get your real estate agent to help you out with this. Make sure to mention any contingencies, land price, and location as well as details of both the seller and buyer. Contingencies help protect a buyer and keep them safe. Some common ones include:

  • The land is eligible for a septic system permit
  • The land will be able to pass any environmental tests
  • Buyer’s requirements and zoning rules coincide
  • An updated survey clearly defines land boundaries, easements, encroachments, and parcel size

The SPA (Sales and Purchase Agreement) form is required once an offer is made and accepted. These forms are binding legal documents and some states may combine the sale and purchase forms into one single contract. While making a cash offer, you will also have to include earnest money. This is a small amount of money that is escrowed to indicate that you are an authentic buyer. The seller can keep the money if you nullify the deal or make use of any contingencies to dissolve an agreement.

Conduct Tests and Surveys

Environmental tests should be the first thing you should do after inspecting the land physically. Soil contamination, sinkhole possibilities, and earthquake damages must be evaluated before you make the final purchase.

It is also necessary to look into soil moisture content as this will ensure the land is stable enough for construction. Get a land surveyor on board to help you out. After an ALTA land survey, you will clearly define boundaries, detect buried pipes and allow surveyors to mark your land exactly using monument markers.

A clear land title is also essential. Title searches cost anywhere between $75 and $100 to ensure there aren’t any outstanding taxes or rights given to third parties.

Close the Deal

If everything meets the criteria you have set and the inspection is successful, it is time to close the deal. If you wish to pay with cash, you will need a cashier’s check and personal checks will not suffice. A cashier’s check reinforces legitimacy as it is issued by the bank. Once this is delivered, it is time to get the deed and you can also opt for closing at a title company. If you went through the whole process alone, it might be a good idea to hire an attorney at this point to do the last job of a real estate agent. An attorney will go over all the contracts and will help you file the deed for recording. Once all of this is done, you are the new owner of the land you dreamed of!


Purchasing land using cash is not a one-step process and surely requires a great deal of research, inspection, and care. However, if you follow all relevant steps carefully and get help from an attorney or a real estate agent, you should be able to close a deal without much trouble.

Home Base Project Team
Home Base Project Team
At The Home Base Project, we offer practical, real-life tips and inspiration about DIY, decorating and gardening. The Home Base Project provide the best information about home renovation and design, connecting home design enthusiasts and home professionals across the world.