Land Cash-Out Refinance in California | HanoverMC
By HanoverMC On January 29 2024
HanoverMC arranges cash-out refinancing against California land — vacant, raw, or agricultural — up to 65% LTV, case by case.
Land Cash-Out Refinance in California: How to Borrow Against Land You Own
6 min read
If you own vacant, agricultural, or partially entitled land in California free and clear or with equity, Hanover Mortgage Company can generally arrange a business purpose 1st cash-out refinance against it. 65% LTV is the maximum HanoverMC generally considers on land, not a target — where a parcel lands under that ceiling depends on entitlement, access, utilities, and marketability, case by case.
Who This Is For
This is for landowners who already hold a specific, developable California parcel and have a real use for its equity — not for general research or hypothetical purchases.
Hanover Mortgage Company is a private money mortgage company that underwrites in-house and orders custom California loan documents for every deal it arranges. All land financing is business purpose only, reviewed with lite documentation, and every parcel is evaluated organically on its own merits rather than against a fixed formula. Capital is funded through whole and fractional California trust deed investors.
Get a Land Equity Quote → — Hanover Mortgage Company reviews land deals case by case. Call (714) 838-1474 or apply online.
What Determines LTV on Land
65% LTV is the ceiling, not a target. There's no standard number across land deals — every parcel is sized individually, and many parcels fall well under that ceiling depending on the factors below.
- Entitlement and zoning status — raw vs. entitled vs. subdivided
- Utility access and proximity (see checklist below)
- Road access and legal ingress/egress
- Topography and grading needs
- Marketability and comparable land sales in the area
- Intended use — residential development, agricultural, commercial, investment hold
- Flood zone, environmental, or easement issues
Entitled land with utilities at the lot line typically supports a stronger LTV than raw acreage awaiting zoning approval, but raw land can still qualify, case by case. Land is harder to value and sell than a finished structure, so LTVs run lower than on improved real estate — Hanover Mortgage Company underwrites primarily on the asset and its equity rather than income or DTI. Every scenario is looked at organically, as a whole situation, with a clear, realistic exit strategy being a key part of the underwriting picture.
What Makes Land "Developable"
Before quoting a deal, underwriting checks whether these are already on the parcel — or genuinely near enough to the lot line to extend affordably:
|
Utility / Access |
What underwriting looks for |
|---|---|
|
Water |
Connected municipal water, a permitted well, or service that can reasonably reach the lot |
|
Sewer or septic |
A sewer connection nearby, or a passed perc test and soil suited to septic |
|
Electricity |
Power lines at or near the parcel, or a documented, reasonably priced extension |
|
Natural gas |
Line proximity, where relevant to the intended use (not always required) |
|
Road access |
A legal, recorded easement or frontage on a maintained public or private road |
|
Grading and drainage |
Topography that doesn't require cost-prohibitive grading, and adequate drainage |
|
Soil / geotechnical conditions |
Stable, buildable soil with adequate bearing capacity and no contamination |
|
Required studies & assessments |
A geotechnical/soil study, plus a Phase I Environmental Site Assessment in some CA counties and cities |
|
Environmental & cultural factors |
No endangered species habitat, active mining claims, or cultural/archaeological artifacts on the parcel |
|
Telecom/broadband |
Proximity to existing infrastructure, for residential or commercial development |
Land missing several of these — no road access, no nearby utilities, unbuildable topography — is harder to underwrite and may not qualify at all.
This matters more if you're planning an ADU: many California cities now require over-excavation and recompaction of the building pad where soil reports find undocumented fill or expansive soil — a real cost to budget for. See the state's ADU Handbook from the California Department of Housing and Community Development.
See What Your Land Could Qualify For → — Submit your parcel details and Hanover Mortgage Company's underwriting team will give you a case-by-case read.
Tools to Research Developability Yourself
Before or alongside underwriting, these can help you verify a parcel's status:
- AI-powered zoning lookup tools — several now exist that scan municipal zoning and land-use codes for a fast first check on allowed use and development standards; useful as a starting point alongside the official sources below
- USFWS IPaC — official federal screening tool for endangered or protected species habitat on a specific parcel
- USDA Web Soil Survey — free county-level soil data, useful before ordering a paid geotechnical study
- FEMA Flood Map Service Center — official flood zone lookup by address or parcel
- CA Dept. of Conservation Abandoned Mine Lands Map — checks a parcel against known historic mining activity
These are research starting points, not a substitute for a licensed geotechnical, biological, or environmental consultant before you commit to a project.
Frequently Asked Questions
Can I refinance land I already own? Yes. If you hold clear, marketable title — raw, entitled, subdivided, or agricultural — Hanover Mortgage Company can generally arrange a business purpose 1st cash-out refinance against it for a legitimate business purpose.
Can raw or unentitled land qualify? Yes, though it's underwritten more conservatively than entitled land, since there's more uncertainty about what can ultimately be built. A clear entitlement path, decent access, and nearby utilities all help the case.
Can I use proceeds for permits, grading, or development? Yes. Proceeds can generally cover pre-development costs — permitting, engineering, grading, utility extensions, entitlement processing, or holding costs — as long as the use is documented as business purpose.
Can I cash out agricultural land? Yes, evaluated case by case on acreage, water rights, access, and marketability — underwritten asset-first, based on equity and collateral quality rather than farm income.
Can I refinance subdivided land? Yes. Subdivided parcels with recorded maps often qualify more easily than raw acreage, since the lots are individually marketable and closer to development-ready — which can support a stronger LTV.
Can an LLC borrow against land? Yes. Hanover Mortgage Company regularly arranges business purpose land financing for LLCs and other business entities.
Can I use land equity toward a bridge loan or a term loan instead? Yes — land equity can fund either. See Hanover Mortgage Company's Bridge Loans and Term Loans programs for how each is structured.
Can land cash-out proceeds go toward another investment property? Yes. A common use of land equity is as a down payment or acquisition capital for another investment property, cross-collateralizing a portfolio, or bridging a purchase.
Some Land Loans HanoverMC Has Arranged
|
Location |
Property |
Loan Amount |
LTV |
Term |
|---|---|---|---|---|
|
Linda, CA (Yuba County) |
Vacant commercial land |
$385,000 1st TD |
50% |
18-month |
|
San Diego, CA 92105 |
Infill residential lot, RM-1-1, no utilities to curb |
$68,000 1st TD |
45.33% |
12-month |
See more on the Transactions page.
Get Started
Talk to Hanover Mortgage Company About Your Parcel → — If your land already has access and utilities nearby, find out what it could unlock. Apply online or call (714) 838-1474 x102.
Hanover Mortgage Company arranges private, business-purpose mortgage financing for property owners and investors throughout California, evaluated on the asset and available equity rather than income or DTI. HanoverMC does not fund loans directly — capital comes from private trust deed investors, with financing arranged under HanoverMC's California DRE broker license.
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