One-Time Close Loans | FHA and VA Construction Loans
VA and FHA One-Time Close Construction Loans

- Build a Home on Your Own Lot -
VA Loan - One-Time Close Construction Loan
FHA Loan - One-Time Close Construction Loan

One-Time Close Facts for First-Time Buyers

One-Time Close Facts for First-Time Buyers
Sometimes half the battle in deciding what type of home loan to apply for is knowing what you really want out of your home. As in, do you need a home designed and built from the ground up on your own lot instead of purchasing someone else’s house?

If that describes you, even as a first-time home buyer, you should seriously consider your options with a One-Time Close construction mortgage.

Buying a home for the first time can be challenging for some; they don’t know the full range of options open to them and as a result they make choices that are less than fully informed. But if you know your options (existing construction loans, build-on-your-own-land loans, etc.) you can make better choices based on your needs and financial goals.

Fact: One-Time Close Construction Loans Are Open to First-Time Home Buyers

FHA One-Time Close loans (FHA OTC) carry the exact same FHA minimum requirements as any other type of home loan for purchase. Your participating lender will explain that the same basic down payment requirements (3.5% minimum for those with qualifying FICO scores) apply, the same rules for mortgage insurance, appraisals, and interest rates also apply.

First time buyers do not have to come up with a bigger down payment just because they have never purchased a home before.

Fact: Lender Requirements Will Vary

Why is it a good idea to shop around for a construction loan? Because not all lenders will offer you the same interest rates and terms. Some lenders may require a higher FICO score for construction loans than for purchase loans to buy existing houses.

Some lenders may not permit you to apply for a construction loan with FICO scores that would qualify for an existing construction home, while others may have similar credit requirements to their other mortgage products. It all depends on the lender.

Fact: It’s Best to Plan Early

Some states have crowded housing markets and permits for construction and other requirements may take much longer in a state like California than in a place like Wisconsin. Demand and the housing market’s ability to respond to that demand will be important factors for some borrowers--start investigating these issues early for best results.

Fact: Construction Loans Will Cost More

Some first-time home buyers aren’t as worried about up-front costs, others need to save money up front and keep their monthly payments within a certain range. Construction loans require more investment than buying an existing construction property because you’ll need a floor plan, laborers to complete the home, inspections must be paid for, permits, etc. Buying an existing construction property may be a better move for those who can’t afford more of the up front costs associated with building instead of buying.

If you aren’t sure you can afford the kind of home you want to build, ask a lender to compare the cost of building versus the cost of buying a comparable home that is already constructed in that housing market.

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. 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: Kit Homes, Barndominiums, Log Cabin Homes, Shipping Container Homes, Stilt Homes, Solar (only) or Wind Powered (only) Homes.

Contact Us:  Send Us Your Request – Spam Safe

Please send your email request to [email protected] which authorizes to share your personal information with one mortgage lender licensed in your area to contact you.
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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