One-Time Close Loans | FHA and VA Construction Loans
Learn all about the VA 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

Understanding Your One-Time Close Mortgage Payment


Understanding Your One-Time Close Mortgage Payment
Building a home on your own lot requires you to do a variety of things before you can accept the keys and move into your brand-new, never-before-owned home. Choosing the lender, selecting the builder, choosing your floor plan, how much you will put down and other decisions are all big parts of the process.

Once those steps are all finished and the One-Time Close mortgage has closed, your first monthly mortgage payment will soon be on its way. If you have never owned a home before, you may wonder what that single-close mortgage payment will consist of.

Your One-Time Close mortgage payment does not simply include a portion of your principal balance, plus interest. 

Your mortgage payment will likely include escrow, any required insurance, and if you are part of a homeowner’s association you will have to budget those fees into your monthly mortgage expenses, too.

Your mortgage statement will include some specific information worth paying attention to. It doesn’t happen all the time, but lenders can and do make mistakes that show up in your monthly mortgage statement. If you see sudden changes in the statement in a given month, contact the lender immediately to learn what happened.

When your first One-Time Close mortgage statement arrives, it should include the following:
 
  • Total mortgage amount
  • Amount due for the month and the due date for payment
  • The interest rate
  • Fees and charges
  • Past due payment information where applicable, plus late fees. 
Many borrowers choose an automatic payment option to make monthly mortgage payments. Not all borrowers may be inclined to do so, especially if you have an adjustable-rate mortgage and are close to a rate adjustment period. 

It’s true that One-Time Close mortgages are offered as 30-year, fixed-interest rate mortgages, but during the construction phase of the loan, your transaction may feature an adjustable rate.

Talk to your loan officer about this issue and ask how an automatic payment could be set up to accommodate changes in the interest rate or what the best option for paying is during the construction phase.

And when it comes time to decide whether to refinance the construction loan or not, remember to review your loan agreement for early penalty payoff information. You want to know if you must pay a penalty to pay off your conventional loan early through refinancing it.

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 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 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 OneTimeClose.com 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 lenders will go up to $1,000,000 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
OTC articles
One-Time Close Loans And Insurance Considerations

When building a home, there are important considerations to make for mortgage insurance and the types of policies you may also need if you are building in an area known for natural disasters. Mortgage insurance and hazard insurance are not the same things and even for homeowner’s insurance policies, there may be a difference in coverage for certain types of incidents like floods or fires.

Understanding Your One-Time Close Mortgage Payment

Building a home on your own lot requires you to do a variety of things before you can accept the keys and move into your brand-new, never-before-owned home. Choosing the lender, selecting the builder, choosing your floor plan, how much you will put down and other decisions are all big parts of the process.

Can I Build A Home With An Adjustable-Rate Mortgage?

If you are interested in building your own home on your own land (or land you purchase in conjunction with the construction loan), you are likely examining your options with an eye on rising interest rates.


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