How To Compare Construction Loan Lenders
November 3, 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 for the first time, finding the right construction loan lender for you might seem daunting, especially when comparing lenders and deciding which one has the best options.
Shopping around for the right construction loan means comparing several online reputations, user reviews, and even Better Business Bureau reports in cases where you aren’t sure about one company or another.
First-time loan applicants do well to review third-party lender review websites like NerdWallet and Investopedia, but you don’t have to take their word for a particular lender. Instead, consider doing your own research by copying the methodology of these third-party reviewers.
How Investopedia Reviews Construction Lenders
Investopedia’s construction loan review page explains how their writers proceed when comparing loan options. “We looked at 24 construction lenders before choosing the best seven.”
To be named one of the best, "we wanted lenders that have a broad geographical reach so that our choices could be used by many."
These writers look for construction loan lenders ”with expertise in several construction loan programs so that you’d find several options without the need to interview many firms.”
The selection process also included companies “whose low end of their interest rate ranges was closest to traditional permanent financing because those are the lowest rates available.”
And there was also preference given to lenders with lower down payment requirements and lower FICO score minimums. That’s an excellent benchmark for a first-time buyer to use when comparing construction lenders on her own.
NerdWallet Construction Lender Review Criteria
Reviewers at this site are fairly extensive, with staff writers or researchers collecting ”over 50 data points from each lender” with a review of company websites, reports, and publicly available documents.
“We may also go through a lender’s pre-qualification flow and follow up with company representatives.”
Is it necessary to do this level of research when comparing lenders before you build a home from the ground up?
Reviewing lender websites plus publicly available third-party information is crucial, but collecting over 50 data points is likely not, at least not for the individual borrower.
However, doing an extensive review of lender review sites, user reviews, and other public data is a very good way to proceed at this stage in the loan preparation process.
Shopping around for the right construction loan means comparing several online reputations, user reviews, and even Better Business Bureau reports in cases where you aren’t sure about one company or another.
First-time loan applicants do well to review third-party lender review websites like NerdWallet and Investopedia, but you don’t have to take their word for a particular lender. Instead, consider doing your own research by copying the methodology of these third-party reviewers.
How Investopedia Reviews Construction Lenders
Investopedia’s construction loan review page explains how their writers proceed when comparing loan options. “We looked at 24 construction lenders before choosing the best seven.”
To be named one of the best, "we wanted lenders that have a broad geographical reach so that our choices could be used by many."
These writers look for construction loan lenders ”with expertise in several construction loan programs so that you’d find several options without the need to interview many firms.”
The selection process also included companies “whose low end of their interest rate ranges was closest to traditional permanent financing because those are the lowest rates available.”
And there was also preference given to lenders with lower down payment requirements and lower FICO score minimums. That’s an excellent benchmark for a first-time buyer to use when comparing construction lenders on her own.
NerdWallet Construction Lender Review Criteria
Reviewers at this site are fairly extensive, with staff writers or researchers collecting ”over 50 data points from each lender” with a review of company websites, reports, and publicly available documents.
“We may also go through a lender’s pre-qualification flow and follow up with company representatives.”
Is it necessary to do this level of research when comparing lenders before you build a home from the ground up?
Reviewing lender websites plus publicly available third-party information is crucial, but collecting over 50 data points is likely not, at least not for the individual borrower.
However, doing an extensive review of lender review sites, user reviews, and other public data is a very good way to proceed at this stage in the loan preparation process.
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
FHA Update New Construction Inspection Rules
October 12, 2024In 2020, the FHA and HUD announced pending changes to the FHA Single-Family Home Loan Lender's Handbook, HUD 4000.1. This was due to policy alterations in 2018 and 2019 which required the FHA and HUD to overhaul portions of HUD 4000.1 to accommodate the modified rules.
Build On Your Lot in Texas with an FHA or VA Construction Loan
October 10, 2024Texas residents are finding out that they can utilize these low One-Time Close down payment programs in order to build a new home with the same underwriting guidelines and qualifications as if they were purchasing a resale. Now may be the time to start looking into building a home that suits your exact needs. Learn more about the One-Time Close construction mortgage.
Using Escrow For Your Construction Loan
October 7, 2024If you have started talking to construction lenders, escrow is likely a term you have encountered in your discussions. However, some aren't sure what escrow is or why it is necessary. Escrow is basically an account used in conjunction with an agreement between you and the lender.
