To buy land from a private seller safely, you have to do the work a broker would normally handle: verify the property, put the deal in a written contract with the right protections, close through escrow with the correct deed, meet federal reporting duties, and record the deed with the county. Skip any of those steps and you can inherit someone else’s liens, lose access to your own land, or find out too late that federal law blocks what you wanted to build.
Verify What You Are Actually Buying
Before you talk price, pin down the parcel. Get the property’s legal description from the county assessor or recorder of deeds. It will be written either as metes and bounds, which traces the perimeter using directions and distances, or as a lot-and-block reference to a recorded subdivision map. Everything else you check hinges on that description matching the land you think you’re buying.
Check the zoning classification with the local planning or zoning department. Zoning controls whether the land can be used for residential, agricultural, commercial, or industrial purposes. If your intended use doesn’t match, you would need a variance or rezoning, and neither is guaranteed.
Pull the county recorder’s file on the parcel and read it for easements and liens. Easements can give utility companies, neighbors, or government agencies the right to cross or use part of the land. Liens for unpaid property taxes, contractor claims, or court judgments attach to the property itself, not just the seller, so an uncaught lien becomes your debt at closing.
Confirm Legal Road Access
A parcel with no public road frontage may be landlocked. Reaching it usually requires an easement across a neighbor’s land. Courts can grant an easement by necessity, but only in narrow circumstances: typically the landlocked parcel and the surrounding land must have once been a single tract, and the lack of access must have been created when that tract was split. Never assume access exists. Read the deed, check for recorded easements, and drive the route to the property.
Look for Private Restrictions
Zoning is only half the story. Covenants, conditions, and restrictions, usually called CC&Rs, are private rules recorded against the land, often by a developer or homeowners’ association. They can limit what you build, what materials you use, or whether you can operate a business. CC&Rs run with the land and bind every future owner, whether or not the seller mentions them. They live in the recorded deed and in any declaration documents referenced there.
Order a Boundary Survey
A professional boundary survey confirms that the physical corners of the land match the legal description. Without one, you risk building on a neighbor’s parcel or finding that fences and structures cross the line. A standard survey for a residential-sized lot typically runs $500 to $1,200; large or wooded parcels cost more.
Run a Title Search and Buy Title Insurance
A title search traces the ownership history to confirm the seller can actually convey clear title. Title companies read recorded documents going back decades, watching for broken ownership chains, undisclosed heirs, recording errors, and outstanding claims. If a problem surfaces after closing, title insurance pays your legal defense and covers losses up to the policy amount.
There are two policies. An owner’s policy protects you for as long as you own the property, up to the full purchase price. A lender’s policy, required when you finance, protects only the lender and only up to the remaining loan balance. If you’re borrowing to buy the land, you need both. Title insurance is a one-time premium paid at closing, generally well under 1% of the purchase price.
Check Mineral, Water, and Timber Rights
Owning the surface doesn’t automatically mean owning what’s under it or the water on it. In many states, mineral rights covering oil, gas, coal, and other subsurface resources can be severed from surface rights and sold to a different owner. When mineral rights are severed, the holder can enter the surface to extract resources without the surface owner’s permission. Read the deed and the county records to see whether mineral rights are included. If they’ve been severed, the deed should say so, though older conveyances may require a deeper search of historical records.
Water rights vary by state. Eastern states generally follow riparian rights tied to owning land next to a water source; western states typically use prior appropriation, where the first person to claim water gets the right regardless of who owns the adjacent land. Timber rights can also be sold off separately. Before closing, get in writing which of these rights transfer with the land and which have been reserved.
Investigate Environmental Restrictions
Federal environmental law applies on private land and can prevent development after you own the property. Two statutes matter most.
If any part of the parcel contains wetlands, the Clean Water Act generally requires a permit from the U.S. Army Corps of Engineers before you fill, grade, or build on those areas.1Office of the Law Revision Counsel. 33 U.S. Code 1344 – Permits for Dredged or Fill Material Normal farming and ranching activities are exempt, but converting wetlands to a new use like residential development requires a permit. Violations can lead to fines, mandatory restoration, or both.
The Endangered Species Act makes it illegal to “take” a listed species, including harming or significantly disrupting its habitat, even on private land.2Office of the Law Revision Counsel. 16 U.S. Code 1538 – Prohibited Acts Federal regulations define “harm” broadly enough to reach habitat modification that injures wildlife by impairing breeding, feeding, or sheltering.3U.S. Fish & Wildlife Service. ESA Basics, 50 Years of Conserving Endangered Species If listed species may be present, an incidental take permit with an approved Habitat Conservation Plan is available, but the process adds time and cost. Check with your state fish and wildlife agency and the U.S. Fish & Wildlife Service before closing.
If the land was previously used for agriculture, manufacturing, or fuel storage, consider a Phase I Environmental Site Assessment. Contamination from prior uses can make you responsible for cleanup as the new owner.
Draft the Purchase Agreement
The purchase agreement is the contract that binds both parties. Under the Statute of Frauds, any agreement to transfer real property must be in writing to be enforceable. A handshake deal for land has no legal force.
The agreement should include:
- Full legal names of all buyers and sellers, exactly as they appear on government identification.
- The purchase price, in both numeric and written form to prevent ambiguity.
- The full legal description of the parcel being transferred.
- The earnest money amount, held by an escrow agent or attorney until closing.
- Contingencies that must be satisfied before the sale is final, such as a satisfactory survey, clear title report, soil percolation test, or environmental review.
- The closing date and the possession date.
Contingencies are what let you walk away without losing your earnest money if the land fails a specific test. A percolation test, for example, measures whether the soil can support a private septic system, which is a common requirement for rural parcels without municipal sewer service. If the test fails, a well-drafted contingency releases you from the deal.
Property Tax Proration
The contract should also spell out how property taxes are split between you and the seller. Property taxes are usually assessed annually but may not be due until months into the assessment period. The standard method calculates a daily tax rate from the most recent annual bill and multiplies by the number of days each party owned the property. The seller’s share is typically credited to you at closing.
Bring in an Attorney
A handful of states require an attorney at real estate closings. Even where the law doesn’t require one, a private sale is exactly the situation where you need your own lawyer, because no licensed agent is watching your interests. A real estate attorney can review the purchase agreement, examine the title, and make sure the deed is drafted correctly, usually for a flat fee that is modest against the purchase price.
Arrange Payment and Escrow
How you pay shapes the whole closing. In a cash deal, you deliver a certified check or wire transfer for the full price at closing. Even cash deals benefit from an escrow agent, a neutral third party (often a title company or attorney) who holds the funds and documents until every contract condition is met, then releases the money to the seller and the deed to you at the same moment. Neither party is left exposed. Escrow fees generally run $500 to $1,000 for a straightforward land transaction.
Owner Financing and Contracts for Deed
If the seller finances the purchase, the arrangement is often a contract for deed, also called a land contract or installment contract. You pay the seller monthly, and the seller keeps the deed until the balance is paid.4Consumer Financial Protection Bureau. What Is a Contract for Deed?
These contracts carry real risk for buyers. Unlike a mortgage lender, who must follow formal foreclosure procedures, a contract-for-deed seller may try to evict quickly for a missed payment and keep everything already paid. Other risks: the seller defaults on their own mortgage and their lender forecloses while you’re current on your payments, the seller refuses to deliver the deed after you finish paying, or the seller collects money for taxes and insurance but never remits it.4Consumer Financial Protection Bureau. What Is a Contract for Deed? If owner financing is the only path, have an attorney review the contract and record the agreement with the county so your interest is on the public record.
Insist on the Right Type of Deed
Not all deeds give you the same protection. The type of deed you receive controls what recourse you have if a title problem appears after closing.
- A general warranty deed provides the strongest protection. The seller guarantees clear title, promises there are no undisclosed liens or encumbrances, and agrees to defend you against ownership claims, including claims that predate the seller’s ownership. Ask for this in a private sale.
- A special warranty deed guarantees only that no title problems arose during the seller’s own ownership. Claims from earlier owners are your problem. These are common in commercial deals where buyers rely on title insurance.
- A quitclaim deed provides no protection. The seller transfers whatever interest they may have, without any guarantee that title is clean or that they own the property at all. Quitclaims are sometimes used between family or to fix minor title defects, but they are risky in a purchase.
If a seller insists on a quitclaim, treat it as a warning. At minimum, don’t accept it without an owner’s title insurance policy in place.
Handle Tax and Reporting Obligations
Private land sales trigger federal reporting duties that the parties themselves must handle when there’s no broker involved.
Form 1099-S
The person responsible for closing (usually the settlement agent, escrow company, or attorney) must file IRS Form 1099-S reporting the sale proceeds. When no settlement agent is involved, which is common in private sales, the duty falls on the attorneys present, the title company, or ultimately on you as the buyer.5Internal Revenue Service. Instructions for Form 1099-S Proceeds From Real Estate Transactions Buyer and seller can also sign a written agreement at or before closing designating who will file.
FIRPTA Withholding
If the seller is a foreign person (not a U.S. citizen or resident), you as buyer must withhold 15% of the amount realized on the sale and send it to the IRS on Form 8288.6Internal Revenue Service. FIRPTA Withholding Reduced rates or exemptions may apply if you plan to use the property as your residence and the price is $300,000 or less. Fail to withhold and you become personally liable for the seller’s tax.
Form 8300 for Large Cash Payments
Anyone in a trade or business who receives more than $10,000 in cash in a single transaction, or in related transactions, must file Form 8300 with the IRS.7Internal Revenue Service. Understand How to Report Large Cash Transactions Real estate transactions are specifically covered. Filing is due within 15 days of receiving the cash.
Record the Deed and Finish the Transfer
Once conditions are met and funds change hands, the seller signs the deed in front of a notary public. The signed and notarized deed must then be physically delivered to you; a valid transfer requires delivery. A signed deed sitting in the seller’s drawer transfers nothing.
After you receive the deed, file it with the county recorder or registrar of deeds. Recording enters it into the public record and gives legal notice that ownership has changed. Recording fees vary widely, often between $50 and $250 per document. Some counties charge a flat fee; others charge per page.
Most states also impose a transfer tax, sometimes called a documentary stamp tax or excise tax, calculated as a percentage of the purchase price. Rates range from as low as 0.01% to as high as 2%, and roughly a dozen states impose none at all. Ask the county recorder before closing so the cost is in your budget.
After recording, the county tax assessor updates its records to show you as the new owner, which sends future tax bills to you. Confirm the update by calling the assessor’s office a few weeks after recording. Errors in the assessor’s file can send tax bills to the wrong address, and penalties accrue whether or not you know about them.