One-Time-Close Construction Loans: Build With One Loan and One Closing
A one-time-close construction loan can coordinate eligible land, construction and permanent financing through one closing. Construction funds are released through managed draws as work is completed, so you avoid a second closing after the home is built. I started my career in construction, so I can speak your builder's language as well as your lender's.
A one-time-close construction loan can coordinate eligible land, construction and permanent financing through one closing. Construction funds are released through managed draws as work is completed. Available loan types, construction periods and payment structures vary by program.
How it works
- Pick your builder and plans. Your builder provides plans, specs, a budget, and a contract.
- Get approved. I review your credit, income, and assets, plus the builder's documents.
- Appraisal "as completed." The appraiser values the home as if it were already built.
- One closing. You close on the lot (if you're buying it) and the full construction-to-permanent loan at once.
- Construction and draws. The builder is paid in stages as work is completed and inspected.
- Move in. When construction finishes, the loan converts to your permanent mortgage. No second closing.
Key requirements
| Requirement | Guideline |
|---|---|
| Loan types | Available loan types vary by program |
| Lot | Buy the lot in the same loan, or build on a lot you already own, where eligible |
| Construction period | Varies by program |
| Payments during construction | Payment structures vary by program |
| Builder | Must be approved by the lender |
Is it right for me?
Good fit
Buyers building a custom or semi-custom home, families who own land and want to build on it, and veterans using VA benefits to build.
Not a fit
Owner-builders acting as their own general contractor, or projects without a licensed, insured builder.
Example (illustrative only)
A family in Brazos County buys a $90,000 lot and contracts a $410,000 build, for a total of $500,000. With a one-time-close loan, they close once, the builder draws funds as the house goes up, and the loan converts to a 30-year mortgage when they move in. One appraisal, one closing, one set of closing costs.
Already own your lot?
The equity in land you own may count toward your down payment.
For builders
I work with builders as a preferred lending partner, coordinating with your team on draw schedules, inspections, and timelines.
Frequently asked questions
What's the difference between one-time close and two-time close?
One-time close is a single loan and closing that converts to a permanent mortgage. Two-time close uses a short-term construction loan, then a second loan and closing when the home is finished.
Can I use a VA loan to build a house?
VA one-time-close construction financing may be available for eligible veterans and service members.
Do I make payments while the house is being built?
Payment structures during construction vary by program. I'll walk you through how payments work for your loan.
What happens if construction costs go over budget?
Overruns are usually the borrower's responsibility, which is why a detailed builder contract and a contingency matter. I'll help you plan for it.
Can I build on land I already own?
Yes, and its equity may help with your down payment.
Related
- Builder Financing Partner in Texas: Move Inventory and Close on Time
- Land and Hobby Farm Loans in Texas
- VA Loans in Texas
Programs, terms, and availability are subject to change without notice and may not be available in all states. All loans are subject to credit and property approval. This is not a commitment to lend. Ask me which options fit your situation.