One-Time Close Loans | FHA, VA, and USDA
Learn all about the VA, USDA, and FHA versions of the One-Time Close Loan.

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

The Base Home Sales Price for One-Time Close Loans

The Base Home Sales Price for One-Time Close Loans
What is the base home sale price? If you are interested in building a home on your own lot using a One-Time Close construction loan, this is a term you should be familiar with; construction loans are different from purchase loans for a variety of reasons but one big one is how the cost of the mortgage is calculated.

One-Time Close (OTC) mortgages feature a single loan for the construction of the property as well as the mortgage to buy that property. Since the home must be built from scratch there are a number of variables that can affect the base price of the home. What kind of variables?

The design itself, for example--are you interested in a one-unit home with a two car garage? That may cost more than the construction of a similar house but with a smaller, one-car option. Do you live in an area where basements are common? If you want a fully finished basement your labor costs may be higher. 

And then there are the choices of material. Do you want a home with granite counter surfaces? Or do you want synthetic materials instead? These are choices that will affect your base price. The base home sales price is more or less a collection of choices you will make about the home in these areas and more.

Not all One Time Close contractors will charge the same for things used to calculate the base price--you may find that some companies have standard offerings of a certain cost, upgrades (like choosing a granite countertop over a laminate top instead), even different layouts and design features. You may also be offered a variety of options for one-story, two-story, split-level, or other design features.

Your OTC contractor can adjust the base sales price depending on the features you prefer to arrive at the amount that will be charged for the project. The more upgrades you have, the higher your base costs will be--it’s good to know what areas you don’t want to skimp on and which areas may be more flexible.

What should you keep in mind when considering this calculation? Not all contractors charge the same--yours may include granite countertops as a standard feature, others may feature those countertops as an upgrade. It is a good idea to shop around for a contractor.

The base home sales price will not include unexpected costs, or “site expenses” that may occur during construction. If there is trouble excavating the ground for a basement, for example, there may be delays resulting in higher costs that could not be anticipated. These site costs are not included in the base home sales price.

When breaking down the expenses for an OTC mortgage, the base home sales price is listed along with any seller-paid costs, the interest expenses over the construction period, and soft costs associated with construction.
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Articles, Updates, and Guidelines
OTC articles
One-Time Close Construction Loan Requirements

 While it’s true that building a home from scratch can at times be harder than buying an existing home, the effort is worth it. The key to getting started is to understand the requirements of these loans, but some are hesitant because the process is unfamiliar to them.

Before You Apply: Four One-Time Close Loan Tips

What do you need to know about One-Time Close mortgages before you apply for one? There are some issues to be aware of that can save you time and frustration--knowing before you start filling out application forms is a big help!

VA One-Time Close Construction Loan Availability

How can you avoid wasting time when you’re interested in applying for a VA One-Time Close mortgage? The first thing to remember is that not all lenders are as well-versed in this type of mortgage as you might expect.

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