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
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How To Credit Qualify For An FHA Construction Loan Or A VA Construction Loan

How To Credit Qualify For An FHA Construction Loan Or A VA Construction Loan
If you're looking to finance the construction of your new home, you may be wondering if you can qualify for a VA or FHA One-Time Close construction loan. In this article, we'll go over the four things you need to credit qualify for one of these loans. 

Remember, VA loans are not offered to all applicants but only to those with qualifying military or uniformed service. FHA loans are offered to all who qualify for the loan.

Qualifying For A VA Or FHA One-Time Close Construction Loan: FICO Scores

FICO scores are the credit scores used by most lenders to determine your creditworthiness. They range from 300 to 850, with higher scores indicating lower risk. For an FHA or VA One-Time Close construction loan, you'll typically need a score of at least 620. But the higher your score, the better your chances of getting approved and getting a lower interest rate.

If you're not sure what your FICO score is, you can get a free credit report from each of the three major credit bureaus - Experian, Equifax, and TransUnion - once every 12 months at Or you can buy your score from major credit scoring companies.

Want to improve your FICO scores? Pay all your bills on time. This is the most critical factor in determining your credit scores. Try to carry a mix of different types of debt, such as revolving debt (credit cards) and installment debt (auto loans). But do NOT open too many new accounts in a short time.

Qualifying For A VA Or FHA One-Time Close Construction Loan: Debt Ratio

Your debt ratio is the amount of your monthly debts compared to your monthly income. For example, if you have $500 in monthly debts and $1,000 in monthly income, your debt ratio is 50%.

Your debt ratio should be 40% or less. That means your monthly debts should not exceed 40% of your monthly income. However, if you have a strong credit history and low risk factors, lenders may be willing to approve a higher debt ratio. Shop around for a lender if your current one won’t consider this.

To calculate your debt ratio, divide your total monthly debts by your total monthly income. If you're not sure what your monthly debts are, add up all of your regular expenses, including mortgage or rent payments, car payments, credit card bills, student loans, personal loans, etc.

Qualifying For A VA Or FHA One-Time Close Construction Loan: Credit Utilization Scores

When lenders are considering you for a loan, one of the key things they look at is your credit utilization score. This is a number that represents how much of your available credit you are using.

For example, if you have a credit card with a $1,000 limit and a balance of $500, your credit utilization score would be 50%.

Ideally, your credit utilization score should be below 30%. This shows lenders that you're using your credit responsibly and not maxing out your cards. If your score is above 30%, try to pay down your balances to improve your chances of getting approved for a loan.

Another important factor in determining your credit utilization score is the number of accounts you have open. If you have several lines of credit open, even if they're not being used, this can help improve your score. That's because it shows lenders that you're capable of managing multiple accounts responsibly.

Qualifying For A VA Or FHA One-Time Close Construction Loan: Other Factors

Lenders want to see that you have a history of making on-time payments, and they'll look at your credit report to get an idea of your repayment history. It will be challenging to qualify for a loan if you have a history of late payments or collections.

Lenders will also look at your employment history when considering you for a loan. They'll want to see that you have steady employment and income. If you've recently changed jobs or had gaps in employment, it may be challenging to qualify for a loan.

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 who know the product well and consistently provide 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 VA 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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