Tips On Using Construction Loan Builders
May 17, 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.
If you would rather build your own new home than buy somebody else’s dream house, you have many options, including FHA One-Time Close mortgages and VA construction loans.
No matter your loan type, the need for third parties, including builders, inspectors, and appraisers, is real. You likely won’t be allowed to act as your own builder, electrician, or plumber.
Screening these third-party services is important.
Some don’t screen these service providers as diligently as they should, and in such cases, it’s easy to fall prey to certain schemes, as we’ll examine below.
When A Contractor Contacts You
When you need a builder and have never hired one before, it’s easy to assume your experience is “industry standard.” Still, there are warning signs to pay attention to avoid getting burned by an unscrupulous service provider.
Never respond to third parties that offer you their services unless you have contacted them first or had a referral made to them on your behalf.
Some homeowners get a knock on the door as an in-person attempt to reach you. A builder who “happens to be in the area” might not offer exactly what’s advertised. Beware.
When You’re Being Pressured To Decide
If a contractor tries to pressure you to make a quick decision, don’t use them. It’s not industry standard to fast-talk you into a decision you don’t have much time to consider. Never give into this kind of pressure, no matter if it’s for a “special deal” or not.
Does The Contractor Only Take Cash?
Run, do not walk away from a contractor who asks you to pay cash for any reason. Cash payments are not a typical part of a construction loan project.
The Builder Needs To Obtain Their Own Permits
Find another contractor if your contractor cannot obtain their permits or asks you to do this on their behalf. You don’t need to do their jobs for them, and unless the borrower is also the builder, obtaining permits is the contractor’s work. Not yours.
Leftover Materials From A Previous Job
Avoid a builder who wants to offer you a price break because, lucky for you, there is leftover material from another job site.
This is a common contractor scam you should not fall for. Don’t work with any builder who offers you an “under the table” arrangement of any kind.
Why? Because you have no recourse if the builder breaks your agreement.
No matter your loan type, the need for third parties, including builders, inspectors, and appraisers, is real. You likely won’t be allowed to act as your own builder, electrician, or plumber.
Screening these third-party services is important.
Some don’t screen these service providers as diligently as they should, and in such cases, it’s easy to fall prey to certain schemes, as we’ll examine below.
When A Contractor Contacts You
When you need a builder and have never hired one before, it’s easy to assume your experience is “industry standard.” Still, there are warning signs to pay attention to avoid getting burned by an unscrupulous service provider.
Never respond to third parties that offer you their services unless you have contacted them first or had a referral made to them on your behalf.
Some homeowners get a knock on the door as an in-person attempt to reach you. A builder who “happens to be in the area” might not offer exactly what’s advertised. Beware.
When You’re Being Pressured To Decide
If a contractor tries to pressure you to make a quick decision, don’t use them. It’s not industry standard to fast-talk you into a decision you don’t have much time to consider. Never give into this kind of pressure, no matter if it’s for a “special deal” or not.
Does The Contractor Only Take Cash?
Run, do not walk away from a contractor who asks you to pay cash for any reason. Cash payments are not a typical part of a construction loan project.
The Builder Needs To Obtain Their Own Permits
Find another contractor if your contractor cannot obtain their permits or asks you to do this on their behalf. You don’t need to do their jobs for them, and unless the borrower is also the builder, obtaining permits is the contractor’s work. Not yours.
Leftover Materials From A Previous Job
Avoid a builder who wants to offer you a price break because, lucky for you, there is leftover material from another job site.
This is a common contractor scam you should not fall for. Don’t work with any builder who offers you an “under the table” arrangement of any kind.
Why? Because you have no recourse if the builder breaks your agreement.
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.
See Your Credit Scores From All 3 Bureaus
Do you know what's on your credit report?
Learn what your score means.
Articles, Updates, and Guidelines
How To Credit Qualify For An FHA Construction Loan Or A VA Construction Loan
February 7, 2023If you are 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 will 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.
Before You Build, Check Your Credit
February 2, 2023If you are building a home in 2023 with a One-Time Close mortgage, you likely understand that these loans have higher credit standards than existing construction mortgages. Sometimes you need every advantage you can get to qualify for a more complex loan like a single close construction mortgage, and paying attention to the credit issues below can help.
Construction Loan Market Outlook Improving In 2023
January 26, 2023Finance blogs are reporting interest rates falling more than three-quarters of a point since the end of October 2022, with more improvements possible down the road. Now is a very good time to consider your construction loan options, though with the caveat that we may experience a bumpy road back to lower rates and less of a seller's market for real estate overall.
