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

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VA Loan - One-Time Close Construction Loan
FHA Loan - One-Time Close Construction Loan

Building A Home When Interest Rates Are Rising

Building A Home When Interest Rates Are Rising
If you want to build a home instead of buying existing construction, you may wonder what you can do to offset rising interest rates and save money on the loan. There are some options to consider that may help.

There are some basic choices to make. For example, do you choose a construction loan that is government-backed like an FHA or VA One-Time Close mortgage? Or do you go for a conventional construction loan that may be harder to qualify for but may save you more money over the lifetime of the mortgage?

Going VA Or FHA

Some decide to explore their government home loan options. Not everyone can qualify for a VA mortgage, but those who do enjoy a zero-down option along with a potentially lower mortgage rate.

FHA home loans are also government-backed, and both VA and FHA single-close loans pose less risk for the lender if the borrower defaults on the mortgage. That is one reason why government-backed mortgages may come with lower interest rates. 

If you choose an FHA construction loan, you may pay more for the loan over time, but the upfront costs including the down payment may be lower. If that is a priority for you when building your home, a government-backed loan may be the best choice. These loans also come with the option to buy discount points up front which could further lower the interest rate.

Waiting To Buy?

Some won’t go for the FHA or VA option; waiting to build is the move some will make. This may be smart if you aren’t sure about your chances for loan approval due to credit score issues or whether you can realistically afford a loan at today’s higher rates.

Some options aren’t available at all; for example, a buyer may want to explore getting an Adjustable Rate Mortgage instead of a 30-year fixed-rate loan. 

But you may find that participating One-Time Close lenders do not allow ARMs for building a residence. It’s true that during the construction phase of the loan, it is subject to interest rate adjustments, but once the construction is done and the home is yours? One-Time Close mortgages are typically 30-year fixed-rate mortgages.

Some want to explore their construction loan options with the idea that they will buy discount points to help lower the interest rate. In general, those who don’t want to sell the home, and plan to stay in the house long-term benefit the most from this strategy. You will need to discuss this option with your One-Time Close lender to see what might be possible.

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 with 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 allow 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 is an eligible veteran, 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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