One-Time Close Loans | FHA and VA Construction Loans
VA and FHA One-Time Close Construction Loans

- Build a Home on Your Own Lot -
VA Loan - One-Time Close Construction Loan
FHA Loan - One-Time Close Construction Loan

Mistakes to Avoid When Building A New Home

Mistakes to Avoid When Building A New Home

When planning to build a home with a One-time Close construction loan, there are some basic expectations you should have going into the process.

For example, you should not assume it is possible to build a home without a down payment. But that's a very obvious issue. What about more complex aspects of building a home on your own lot?

Some worry about going over or under budget, and it's true that you can apply for a mortgage loan to build a home without knowing all the costs associated with such a project.

You may find that the costs of building are higher than you expect. In such cases it pays to have a contingency reserve, but what about times when the construction loan actually does not use the entire loan amount?

Believe it or not, it can happen; don’t expect to use every single dollar of those loan funds and it's pointless to try.  The best advice is to plan the home you want and plan on the amount of money you need to get the job done with some extra set aside just in case.

And when doing all that, it pays to anticipate issues that could result in higher costs. You might want budget fixtures and features for your new home, but how long will they last and does it make sense to pay a bit more for things that will last longer in the home?

Home loans for construction and renovation sometimes feature some of the same concerns. If you have ever used a rehab loan before you'll find some common advice that can apply to construction loans, too. For example, don’t expect to use the whole loan to build your home.

Your project may come in under budget. In such cases, you should not expect cash back. Loan funds can only be used for approved purposes.

Borrowers using a rehab loan to renovate a fixer-upper would ask in this stage of planning whether there are extensive projects such as the replacement of an entire electrical system or an entire, outdated heating and cooling system.

But with a construction loan, the issues have more to do with the quality of the new fixtures, appliances, and other features in the home.

Instead of borrowing with an eye on replacing these features, building your home means deciding whether to spend more upfront for better quality items you won't need to replace in the earliest years of the loan, or opting for a more affordable option you may need to replace sooner rather than later.

The lifespan of the features you pay for should definitely be a factor in your decision-making process.

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. 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 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 $1,500,000 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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