Land loans are generally harder to qualify for than a traditional mortgage. How do Land Loans Work?Ī land loan is a loan designed to help you purchase vacant land which can be used in different ways, such as farming or building a home. What do you do if you don’t have the cash? Whether you’re getting the land to start a farm or expand your farm, a land loan could be the answer. Farming takes a number of up front costs, and one of those could be purchasing land.