I went through your situation. The interest rates are higher on land loans due to their speculative market value, and typically, you have to take out a loan with a bank that is in the general area of the land. Also, they generally don't want to give you a fixed rate, and their floaters always seem to be higher than they should based on movements in like-maturity treasuries. For instance, mine was amortized over 20 years, but reset every two years based on interest rate changes. 2 year treasuries went down 8/10 of a percent, and they jacked UP my rate after two years by a full percent. They would have even gone up higher but promised me a 1% cap. They got away with it because their rate is whatever they want it to be, and they are out to make money on you. They wouldn't tie it to a benchmark security that they could be held to. When my house value increased quite a bit, I took out a second mortgage on my primary residence and paid off the land loan. The rate was higher than my first mortgage, but lower than the land loan. End result: I got a lower rate, fixed rate, and knocked off about two years off the life of the loan, all at the same time. Yes, you can write off a land loan if you have a dwelling there (even a trailer). If you roll it into a second as I have done, obviously you can write that off too.