So You Got a Letter Offering to Buy Your Land? (Part 1)

I’ve heard the question from landowners often: why does everybody want my land? If you own land, you’ve likely gotten calls, texts and the type of offer we’re talking about today: the letter.

We’ve all gotten them – someone we’ve never heard of offering to help us get rid of the land we’ve been holding onto. Sometimes it has an actual offer amount, others are just telling us they’re interested in making us an offer.

Most landowners react the same way when one of these lands in the mailbox. Suspicion first, curiosity second. But somewhere in there, a question comes up: Is this for real, and is it any good?

In the past few years, we’ve bought more than 100 properties and thousands of acres across the country – many through sending letters like this. What follows is what I’d tell my own mom before she signed anything.

Why am I getting these letters?

I get asked this often, usually with suspicion. Is there a data center moving in? A new pipeline? Some secret development nearby? No, no and no. The more likely explanation is that you’re getting these letters solely because you own land. Which means your name, address, property details, acreage, and loads of other information are sitting in a public county database that any investor can pull for free. Companies get that data, filter for vacant or absentee-owned tracts, and send letters. Lots and lots of letters.

Why does it seem like these letters just started arriving? The industry started growing over the past several years – somewhat mirroring what happened with house flipping in the 2010s. The reason it works is that there are millions of vacant rural parcels in this country. A lot of them were inherited, or bought 30 years ago as someday-land that never became anything, or are absentee headaches whose owners would rather have cash than deal with the hassle of listing it. And why does that translate into a real business? People want easy and will pay (or take a discount in this case) for it.

Most of the companies mailing you are real businesses. What’s wildly different from one letter to the next is what they’ll pay, whether they’ll close, and whether they intend to buy the land themselves or plan to sell the contract to buy your land (called “wholesaling” – more on this below).

Two types of buyers

This is an oversimplification, but in most cases, the letter or offer you’re receiving comes from two types of businesses: the first is a direct cash buyer, and the second is something called a wholesaler.

A direct cash buyer is exactly what it sounds like: a buyer who is purchasing the land directly from you and plans to “take title” to it.

A wholesaler is a little more complicated. When a wholesaler is a buyer, this means they don’t have the funds to close themselves, or don’t intend to, and they’re trying to sell your contract to another investor for a profit to take their place as the buyer before the closing date. If they can’t find the end buyer in time, they cancel and you’re stuck with your land that you’re no closer to having sold.

Wholesaling is legal in most states. Plenty of wholesalers operate ethically, and the good ones will tell you up front that’s their model. But you should know what you’re signing.

We’ll come back to these later.

Is this a scam?

I get this question a lot, and the honest answer is that almost none of these letters are scams in the criminal sense. The buyer is usually a real company, making a real offer. The risk isn’t that you’re going to get defrauded. The more likely risks are that:

1. You get much less for your property than you could have because you assumed this was the best offer you could get for your land, or
2. You sign an agreement with a wholesaler who isn’t actually planning to buy it, but will be looking for an end buyer. And if they can’t find the end buyer in time, they cancel and you’re stuck with your land that you’re no closer to having sold.

The scams that exist in the real estate industry are usually a different animal. They mostly involve title fraud, where someone forges a deed and tries to sell land they don’t even own to an unsuspecting buyer. I wrote about that topic on LANDTHINK back in November titled “How to Protect Yourself From Vacant Land Scams,” if you want to go down that rabbit hole. But it’s a different problem from the one in your mailbox today.

So when one of these letters lands, the right move is to treat it like information, not a deadline. Look up who’s behind it, read what the contract says, and figure out what your land is worth before you make any kind of decision. None of that takes long.

What the deposit tells you

The earnest money deposit is the best single tell on a land contract. A serious cash buyer is willing to put real money down. Usually around 1% of the purchase price, with a floor of a few hundred bucks on smaller deals – ideally some of that deposit should go hard (non-refundable) after the due diligence period ends.

If there’s no deposit at all, or the whole deposit is refundable forever, the buyer has nothing on the line. A quick distinction worth making: a refundable deposit during the first 7 to 14 days is normal and reasonable. The buyer is checking title, access, and boundaries in that window, and checking out the property in person, which is all necessary. The problem is when a contract lets the buyer walk away with the entire deposit at any point, for any reason, for as long as the contract runs. What you’ve signed is a free option to buy your land at that price, and you’re locked out of selling to anyone else while the buyer decides whether to close.

A deposit that goes non-refundable after due diligence ends is how a serious buyer shows commitment. If they resist that, ask why.

A longer closing timeframe

For a typical (non-commercial) piece of land, a direct cash buyer doesn’t need 90 days for a normal piece of property. They can typically close in 25 to 45 days, enough time for title work, a survey if needed, and standard due diligence. When you see 90+ days to close on a contract, it’s very possible, even likely that the buyer is planning to wholesale it. It’s not a dealbreaker, but you need to consider that when making your decision. A 30-day close with a non-refundable deposit is a much more certain transaction than a 180-day close with nothing on the line.

The exceptions to this are 1. if the buyer needs to get a loan or time to come up with the cash, and 2. if the buyer plans to develop the lot – like a larger subdivision or a building and they need to ensure feasibility or get a permit. That comes up on commercial lots and the occasional building lot, but not often on vacant land.

That covers what’s showing up in your mailbox and how to read the contract terms. In Part 2, we’ll get into the harder questions: how to vet the buyer, how to figure out what your land is worth, and what to do with the offer once you have one.