Buy Or Build: Home Loan Options For First-Time House Hunters
April 5, 2024
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.
Are you a first-time home buyer? Some assume that just one type of home loan is offered and that getting the right home means filling out a generic credit application.
But the reality is that depending on whether you want to build or buy, there are specific mortgage programs, procedures, and terms you should know about before you commit.
We compare some of the most popular home loan options below.
Mortgages For Existing Suburban Homes
When a borrower wants to buy someone else’s house, an FHA 203(b) purchase loan or a VA equivalent are two examples of government-backed home loans to choose from.
These types of mortgages let owner-occupiers buy an existing house that meets VA or FHA guidelines and state standards. These properties are typically up to code and state requirements or can be modified based on an appraiser’s report to meet those standards.
Home Loans For Renovation
Some don’t want a brand new home. They seek a fixer-upper house to improve and move into.
Options are available for these borrowers, including the FHA 203(k) rehabilitation loan, designed to help borrowers buy and renovate or refinance and renovate property that can’t pass an appraisal. The house must be made compliant as a condition of home loan approval.
VA and FHA One-Time Close Construction Loans
VA and FHA One-Time Close construction mortgages are the best choices for those who don’t want to move into someone else’s dream home and want more control over the property's design.
However, the one-time close loan can be harder to qualify for, and the process takes longer than a traditional mortgage.
But for many first-time buyers, it’s worth the effort.
Borrowers who want more control over the quality of the property's materials, appliances, and overall design may gravitate toward this type of home loan, especially given that the FHA and VA down payment requirements for these more expensive loans are no different than for purchase loans.
Being more expensive, single-close construction loans are riskier for the lender. You may find that your participating lender requires higher FICO score ranges for loan approval, and down payment assistance is typically not allowed for One-Time Close loans.
You’ll want to take some additional planning and saving time to work on your credit scores and debt ratio before applying.
But the reality is that depending on whether you want to build or buy, there are specific mortgage programs, procedures, and terms you should know about before you commit.
We compare some of the most popular home loan options below.
Mortgages For Existing Suburban Homes
When a borrower wants to buy someone else’s house, an FHA 203(b) purchase loan or a VA equivalent are two examples of government-backed home loans to choose from.
These types of mortgages let owner-occupiers buy an existing house that meets VA or FHA guidelines and state standards. These properties are typically up to code and state requirements or can be modified based on an appraiser’s report to meet those standards.
Home Loans For Renovation
Some don’t want a brand new home. They seek a fixer-upper house to improve and move into.
Options are available for these borrowers, including the FHA 203(k) rehabilitation loan, designed to help borrowers buy and renovate or refinance and renovate property that can’t pass an appraisal. The house must be made compliant as a condition of home loan approval.
VA and FHA One-Time Close Construction Loans
VA and FHA One-Time Close construction mortgages are the best choices for those who don’t want to move into someone else’s dream home and want more control over the property's design.
However, the one-time close loan can be harder to qualify for, and the process takes longer than a traditional mortgage.
But for many first-time buyers, it’s worth the effort.
Borrowers who want more control over the quality of the property's materials, appliances, and overall design may gravitate toward this type of home loan, especially given that the FHA and VA down payment requirements for these more expensive loans are no different than for purchase loans.
Being more expensive, single-close construction loans are riskier for the lender. You may find that your participating lender requires higher FICO score ranges for loan approval, and down payment assistance is typically not allowed for One-Time Close loans.
You’ll want to take some additional planning and saving time to work on your credit scores and debt ratio before applying.
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 Loan Issues: Weather Delays
October 22, 2024One-Time Close construction projects are subject to many variables that can change their timelines. Weather is a particularly unpredictable factor to consider, and depending on where you live, issues may range from snow and rain to extreme temperatures. Weather is a variable that can cause construction disruptions, delays, potentially increased costs, and frustration for borrowers. Knowing that upfront can help, especially when it is time to plan your contingency fund.
Build On Your Lot in Illinois using an FHA or VA Construction Loan
October 21, 2024There is a FHA and VA government backed One-Time Close construction to permanent loan program available in Illinois for qualified applicants who are looking to build a brand-new home versus a resale.
Using a One-Time Close Residential Construction Loan to Build a Residence
October 15, 2024Building a new home can be exciting. It can also be a complex process, and it pays to understand as much of it as possible while planning your home loan. If you want to use a one-time close residential construction loan to build your home from the ground up, there are three things to consider.
