One-Time Close Construction Loans In Florida

What is a One-Time Close Construction Loan?

A one-time close construction loan is a mortgage program that combines the construction, lot acquisition, and permanent loan financing for a new home into a single mortgage with a single closing. This loan eliminates the need for borrowers to go through two separate closings and re-qualification processes, previously necessary for most construction loans. Borrowers benefit from one-time close construction loans in various ways, including affordability, because they only pay for one closure and the option to lock in their permanent interest rate simultaneously.

One-Time Close vs. Regular Construction Loan

The main difference between a one-time close construction loan and a regular construction loan (two-time close) lies in the number of closings and the structure of the loans.

• Number of closings:

A one-time close construction loan combines interim and permanent construction loan financing into a single loan that requires only one closing. On the other hand, regular construction loans necessitate two closings: one for the construction phase and another when converting to a permanent mortgage.

• Closing costs:

A one-time close construction loan requires only one payment of closing fees, but regular construction loans require payment of closing costs twice — once for each loan.

• Payments:

One-time closing construction loans typically involve interest-only payments during construction, with a lump sum due at the end. Payment structures for regular construction loans might vary depending on the lender and loan terms.

• Rates:

One-time close construction loans may have higher interest rates than traditional mortgage loans.

• Flexibility:

One-time close construction loans are prepackaged programs, but regular construction loans may provide more flexibility regarding loan structure and terms.

• Loan-to-Value

The loan-to-value ratio in a one-time close construction loan is usually determined by the lesser of the project cost and appraised value. Regular construction loans may have varying loan-to-value ratios depending on the loan program and lender regulations.

Types of One-Time Close Construction Loans

• FHA One-Time Close Loan

This is a government-backed mortgage program for single-family stick-built homes, new manufactured homes for primary residences (excluding single-wide mobile homes), and modular homes.

• VA One-Time Close Loan

This loan is intended solely for eligible veterans and service members, and it combines construction, lot acquisition, and permanent loan financing into a single closing.

• USDA One-Time Close Loan

A rural development loan is accessible in some rural and suburban areas and provides a 30-year fixed-rate mortgage with no down payment.

Single-family homes, owner-occupied properties, modular, manufactured, stick-built, and doublewide homes are just a few property types that can be used with these one-time close construction loans. Various loans may be available depending on the specific loan program and the borrower’s qualifications.

Apply for a One-Time Close Construction Loan in Florida

Numerous factors must be considered when constructing a new residence. Capital Home Mortgage can facilitate this process with a One-Time Close Construction Loan. We provide a seamless process from the initial groundbreaking to the final move-in. Our Loan Officers will collaborate with you and your home builder to guarantee a smooth transaction.

To speak with one of our Construction Loan Specialists, call (239) 310-5599.