When Are You Ready To Build Your Home?
March 21, 2023
FHA, VA, and USDA: One-Time Close Loans
Want More Information About One-Time Close Loans?
We have done extensive research on the FHA (Federal Housing Administration) and the VA (Department of Veterans Affairs) One-Time Close Construction loan programs. We have spoken directly to licensed lenders that originate these residential loan types in most states and each company has supplied us the guidelines for their products. We can connect you with mortgage loan officers who work for lenders that know the product well and have consistently provided quality service. If you are interested in being contacted by a licensed lender in your area, please send responses to the questions below. All information is treated confidentially.
OneTimeClose.com provides information and connects consumers to qualified One-Time Close lenders to raise awareness about this loan product and to help consumers receive higher quality service. We are not paid for endorsing or recommending the lenders or loan originators and do not otherwise benefit from doing so. Consumers should shop for mortgage services and compare their options before agreeing to proceed.
Please note that investor guidelines for the FHA and VA One-Time Close Construction Program only allows for single family dwellings (1 unit) – and NOT for multi-family units (no duplexes, triplexes or fourplexes). In addition, the following homes/building styles are not allowed under these programs, including but not limited to: Kit Homes, Barndominiums, Log Cabin Homes, Shipping Container Homes, Stilt Homes, Solar (only) or Wind Powered (only) Homes, Dome Homes, Bermed Earth Sheltered Homes, Tiny Homes, Accessory Dwelling Units, or A-Framed Homes.
All known FHA/VA One-Time Close Lenders known to our company will not allow a borrower to act as their own contractor, whatsoever. There cannot be self-builds, relative builds, or employer builds.
Contact Us: Send Us Your Request – Spam Safe
Please send your email request to [email protected] which authorizes OneTimeClose.com to share your personal information with one mortgage lender licensed in your area to contact you. No SSN required • No credit check • 100% free to get started
1. Send your first and last name, e-mail address, and contact telephone number.
2. Tell us the city and state of the proposed property.
3. Tell us your and/or the Co-borrower’s credit profile: Excellent – (680+), Good - (640-679), Fair – (620-639) or Poor- (Below 620). 620 is the minimum qualifying credit score for this product.
4. Are you or your spouse (Co-borrower) eligible veterans? If either of you are eligible veterans, down payments as low as $0 may be available up to the maximum amount your debt-to-income ratio per VA will allow – there are no maximum loan amounts as per VA guidelines. Most lenders will go up to $1,500,000 and review higher loan amounts on a case-by-case basis. If not, the FHA down payment is 3.5% up to the maximum FHA lending limit for your county.
If you are building a home using a single-close mortgage, you likely already know the process is more complex than buying an existing home. That shouldn’t stop you from building the house you want, but there are critical mistakes to avoid when planning your home. Do you know what they are? How do you know if you are ready to build your home?
Not Doing Enough Home-Building Homework
You might miss important details if you skimp on the research phase of your house-building journey. You want to know how long it takes to get building permits in your housing market, whether the area is known for a specific type of natural disaster or bad weather, and what the area's future might be.
For example, you likely do not want to build your new home near a zone designated as major shopping center development. The same is true for buying land or building on it when that land is near a major airport expansion project.
What is the water delivery system in your market--are there serious lead water pipe issues, such as in Chicago? Or has the community already mitigated the risks of old and unsustainable infrastructure? Know the area before you commit to building there.
Not Researching Your Contractors
Many agree that “the biggest mistake you can make” when using a One-Time Close construction loan is not vetting your contractors. Do you know the online and local reputations for your custom builder? Plumber? Pest control companies?
Read the online references, review the company’s portfolio, and try to be as pragmatic as possible about the construction loan's costs, deadlines, and other features.
Be Pragmatic
You’ll want to be ruthless about the funding of your construction project, including making plans for cost overruns, delays, and missed deadlines.
It is unsafe to assume the project will go 100% as scheduled or planned. Expect delays and anticipate them by saving some extra funds for contingencies. You never know when the weather, local politics, or even a global pandemic might interfere with your plans. Expect delays.
Don’t Act Too Quickly
Being too eager to move forward with the process can be a mistake if you have not adequately prepared your credit, saved up enough for a down payment, etc.
Don’t move forward with the loan if you aren’t sure about whether you can afford the money down, the cash needed for escrow, insurance, etc. Save enough to cover your down payment and other expenses, don’t rush into the loan.
Not Doing Enough Home-Building Homework
You might miss important details if you skimp on the research phase of your house-building journey. You want to know how long it takes to get building permits in your housing market, whether the area is known for a specific type of natural disaster or bad weather, and what the area's future might be.
For example, you likely do not want to build your new home near a zone designated as major shopping center development. The same is true for buying land or building on it when that land is near a major airport expansion project.
What is the water delivery system in your market--are there serious lead water pipe issues, such as in Chicago? Or has the community already mitigated the risks of old and unsustainable infrastructure? Know the area before you commit to building there.
Not Researching Your Contractors
Many agree that “the biggest mistake you can make” when using a One-Time Close construction loan is not vetting your contractors. Do you know the online and local reputations for your custom builder? Plumber? Pest control companies?
Read the online references, review the company’s portfolio, and try to be as pragmatic as possible about the construction loan's costs, deadlines, and other features.
Be Pragmatic
You’ll want to be ruthless about the funding of your construction project, including making plans for cost overruns, delays, and missed deadlines.
It is unsafe to assume the project will go 100% as scheduled or planned. Expect delays and anticipate them by saving some extra funds for contingencies. You never know when the weather, local politics, or even a global pandemic might interfere with your plans. Expect delays.
Don’t Act Too Quickly
Being too eager to move forward with the process can be a mistake if you have not adequately prepared your credit, saved up enough for a down payment, etc.
Don’t move forward with the loan if you aren’t sure about whether you can afford the money down, the cash needed for escrow, insurance, etc. Save enough to cover your down payment and other expenses, don’t rush into the loan.
FHA, VA, and USDA: One-Time Close LoansWant More Information About One-Time Close Loans?We have done extensive research on the FHA (Federal Housing Administration) and the VA (Department of Veterans Affairs) One-Time Close Construction loan programs. We have spoken directly to licensed lenders that originate these residential loan types in most states and each company has supplied us the guidelines for their products. We can connect you with mortgage loan officers who work for lenders that know the product well and have consistently provided quality service. If you are interested in being contacted by a licensed lender in your area, please send responses to the questions below. All information is treated confidentially.
OneTimeClose.com provides information and connects consumers to qualified One-Time Close lenders to raise awareness about this loan product and to help consumers receive higher quality service. We are not paid for endorsing or recommending the lenders or loan originators and do not otherwise benefit from doing so. Consumers should shop for mortgage services and compare their options before agreeing to proceed.
Please note that investor guidelines for the FHA and VA One-Time Close Construction Program only allows for single family dwellings (1 unit) – and NOT for multi-family units (no duplexes, triplexes or fourplexes). In addition, the following homes/building styles are not allowed under these programs, including but not limited to: Kit Homes, Barndominiums, Log Cabin Homes, Shipping Container Homes, Stilt Homes, Solar (only) or Wind Powered (only) Homes, Dome Homes, Bermed Earth Sheltered Homes, Tiny Homes, Accessory Dwelling Units, or A-Framed Homes.
All known FHA/VA One-Time Close Lenders known to our company will not allow a borrower to act as their own contractor, whatsoever. There cannot be self-builds, relative builds, or employer builds.
Contact Us: Send Us Your Request – Spam Safe
Please send your email request to [email protected] which authorizes OneTimeClose.com to share your personal information with one mortgage lender licensed in your area to contact you. No SSN required • No credit check • 100% free to get started
1. Send your first and last name, e-mail address, and contact telephone number.
2. Tell us the city and state of the proposed property.
3. Tell us your and/or the Co-borrower’s credit profile: Excellent – (680+), Good - (640-679), Fair – (620-639) or Poor- (Below 620). 620 is the minimum qualifying credit score for this product.
4. Are you or your spouse (Co-borrower) eligible veterans? If either of you are eligible veterans, down payments as low as $0 may be available up to the maximum amount your debt-to-income ratio per VA will allow – there are no maximum loan amounts as per VA guidelines. Most lenders will go up to $1,500,000 and review higher loan amounts on a case-by-case basis. If not, the FHA down payment is 3.5% up to the maximum FHA lending limit for your county.
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Articles, Updates, and Guidelines
Mistakes to Avoid When Building A New Home
December 20, 2022When planning to build a home with a One-time Close construction loan, there are some basic expectations you should have going into the process. For example, you should not assume it is possible to build a home without a down payment. But that's a very obvious issue. What about more complex aspects of building a home on your own lot?
Building Your New Home In 2023
December 15, 2022Government home loan limits are increasing in 2023 and there are indications that the housing market in general may become more favorable to buyers as the new year wears on. No, that won't happen overnight. But the predictions at press time seem to indicate better days are coming.
Construction Loans And Consumer Protection
December 13, 2022The U.S. Chamber of Commerce describes non-bank lenders as a financial institution that lends money but doesn't operate with a full banking license. It does not offer deposit, checking, or savings services. This definition is important, because non-bank entities have become more common in the construction loan space over the years, and now the federal government is stepping up efforts to hold these companies accountable should they run afoul of the law.
