The Right Time To Build On Your Own Lot?
March 28, 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.
Spring of 2023 may be an excellent time to think about building a home on your own lot. Why? In the last week of March 2023, the headlines were full of news about falling mortgage loan interest rates in the wake of the Fed’s announcement of another rate hike. The hike isn't what made rates fall. It's what the Fed said about future hikes.
Specifically, rates fell thanks to investor reaction to the Fed’s statement that new rate hikes might not be a factor in future Fed decisions. Such hikes don't directly change mortgage loan interest rates, but they can affect the mortgage market in general.
Only time will tell, but CNBC reports, “the rate-setting Federal Open Market Committee noted that future increases are not assured and will depend largely on incoming data.”
Fed Policy And Construction Loans
That Fed policy could affect how the construction loan market looks in the Spring 2023 season. The idea that more rate hikes may not be coming coupled with falling mortgage rates (at press time, conditions are always subject to change) and what you get is a market that more borrowers are tempted to look into in the wake of some brutal interest rate hikes.
Fed policy doesn’t directly change the construction loan market. But investor reaction to Fed policy can and does change it. As the CNBC report indicates, what is to come depends on new data we don’t have yet.
In the meantime?
Falling Interest Rates: Will They Persist?
Falling rates are good. Mortgage rates are nowhere near the five percent zone yet, but any movement away from the seven percent zone we’ve seen them approach in the past is welcome.
If you have been planning and saving for just the right moment, this may not be the absolute right time for you to start comparing lenders, but if you need to start sooner rather than later, this may be a good time to explore your options.
It’s not safe to assume that today’s rates are anything more than a temporary move until a consistent pattern emerges.
When rates remain consistently low, as they did for years when they routinely held a sub-five-percent range, people tend to assume those rates are here to stay, at least long enough to apply and close the deal.
That’s not a terrible assumption, but only when rates don’t experience the kinds of restless highs and lows we've seen in the last six months.
Getting Ready To Build In 2023
The more competitive you are as a borrower, the better. If you are truly ready to apply for a One-Time Close construction loan with FICO scores, 20% down, and a rock-solid history of on-time payments in the 12 months leading up to your application, you could be ready to apply.
But if you have weaknesses in any of those areas, it pays to spend the additional time fixing those issues before you apply. You’ll make it easier for the lender to justify approving the loan.
Specifically, rates fell thanks to investor reaction to the Fed’s statement that new rate hikes might not be a factor in future Fed decisions. Such hikes don't directly change mortgage loan interest rates, but they can affect the mortgage market in general.
Only time will tell, but CNBC reports, “the rate-setting Federal Open Market Committee noted that future increases are not assured and will depend largely on incoming data.”
Fed Policy And Construction Loans
That Fed policy could affect how the construction loan market looks in the Spring 2023 season. The idea that more rate hikes may not be coming coupled with falling mortgage rates (at press time, conditions are always subject to change) and what you get is a market that more borrowers are tempted to look into in the wake of some brutal interest rate hikes.
Fed policy doesn’t directly change the construction loan market. But investor reaction to Fed policy can and does change it. As the CNBC report indicates, what is to come depends on new data we don’t have yet.
In the meantime?
Falling Interest Rates: Will They Persist?
Falling rates are good. Mortgage rates are nowhere near the five percent zone yet, but any movement away from the seven percent zone we’ve seen them approach in the past is welcome.
If you have been planning and saving for just the right moment, this may not be the absolute right time for you to start comparing lenders, but if you need to start sooner rather than later, this may be a good time to explore your options.
It’s not safe to assume that today’s rates are anything more than a temporary move until a consistent pattern emerges.
When rates remain consistently low, as they did for years when they routinely held a sub-five-percent range, people tend to assume those rates are here to stay, at least long enough to apply and close the deal.
That’s not a terrible assumption, but only when rates don’t experience the kinds of restless highs and lows we've seen in the last six months.
Getting Ready To Build In 2023
The more competitive you are as a borrower, the better. If you are truly ready to apply for a One-Time Close construction loan with FICO scores, 20% down, and a rock-solid history of on-time payments in the 12 months leading up to your application, you could be ready to apply.
But if you have weaknesses in any of those areas, it pays to spend the additional time fixing those issues before you apply. You’ll make it easier for the lender to justify approving 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
One-Time Close Construction Loans Versus Two-Close Loans
November 1, 2024There is a mortgage loan option that lets you build a house from the ground up on land you own or purchase in conjunction with the loan. The One-Time Close loan is the mortgage you want to ask the lender for to build a home from the ground up instead of buying someone else's dream home.
Build On Your Lot in Georgia with an FHA or VA Construction Loan
October 29, 2024Residents in Georgia are finding out that they can utilize these low-down payment construction programs in order to build a new home with the same underwriting guidelines and qualifications as if they were purchasing a resale. Learn more about One-Time Close construction mortgages.
One Time Close Mortgages 101
October 26, 2024The Federal Housing Administration (FHA) offers a range of mortgage loan options including the ability to build your home from the ground up. The FHA One-Time Close Construction Loan streamlines the process by combining construction financing and the FHA mortgage into a single loan.
