Learn About FHA and VA Construction Loans
Find out how you can build a home on land you already own.
If you've decided to have your new home built from scratch, you might be wondering how to finance the construction and purchase. This Single Close Loan gets you from construction to occupancy with one mortgage in a streamlined process.
PDF Download: One-Time Close 101
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The One-Time Close Loan is a mortgage program that finances the construction, lot purchase, and permanent loan of a new home, all wrapped up in a single mortgage with a single closing.
Previously, most construction loans required two separate closings, as well as a re-qualification process. The One-Time Close Loan helps you avoid the extra step, saving you time and money. And with Single Close Loans available through the VA and FHA, having your new home built on your own land is easier than before!
September 13, 2024Do you want to build a home using an FHA or VA One-Time Close loan? If you do not currently own land or you need to keep the land you already own for another purpose, there are several considerations when buying undeveloped land you want to use to build your dream home on. Building on a new plot of land can provide some borrowers with additional customization and personalization options. It may offer greater control over the design and layout of your dream home.
September 6, 2024One-Time Close Mortgages can be an appealing option for those who want to build their dream home instead of buying someone else’s house.
Unlike traditional construction loans that involve multiple closings and complex financing stages, a One-Time Close Mortgage simplifies the process, potentially saving borrowers time and money. A One-Time Close mortgage features financing for the construction phase plus the permanent mortgage, presented as a single loan.
August 30, 2024Construction loans differ significantly from existing construction mortgages. The unique nature of these loans includes some potential challenges borrowers must be prepared to handle. What choices do you need to make about construction loans during the planning stages? What about after the construction begins?
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Non-Allowable Properties
The following home property types are excluded from the program, meaning that you won't be able to use the One-Time Close loan for financing:
Kit Homes
Steel framing kits for metal buildings that are assembled on site.
Barndominiums
Metal structures that combine living quarters with traditional barn space.
Log Cabin Homes
Pre-cut kits for log buildings that are assembled on site.
Shipping Container Homes
A dwelling made from a steel container otherwise used for shipping
Stilt Homes
Houses raised on piles over land or a body of water.
Solar Only or Wind Only Powered Homes
Homes that are powered on-site solely by solar panels or solely by wind turbines.
Dome Homes
Homes made in the shape of a sphere utilizing shell framework.
Bermed Earth Sheltered Homes
Homes with earth (soil) against the walls, roof or buried underground.
Tiny Homes
Homes that are 600 square feet or less.
Accessory Dwelling Units
Additional living quarters that are independent of the primary dwelling.
A-Framed Houses
Building with a tall triangular roof that resembles the letter A.
The primary reason for these exclusions is that all non-regular homes are considered unique properties and hard to get comps for under VA and FHA. These homes require specialized construction techniques, making it even more important that a single builder starts and finishes a project. If the builder were to quit before a job is finished, the lender would need to step in and find a replacement. This can be more difficult than usual due to the specific nature of the work.
