Loan Program
Building is the one transaction where the financing structure genuinely changes the outcome. A one-time close means you sign once, at the start, and the loan converts to a permanent mortgage when the house is finished. The alternative is closing twice and requalifying at the end, at whatever rates exist then.
A one-time-close construction-to-permanent loan is underwritten and closed before construction starts. During the build it functions as an interest-only line drawn in stages; when the certificate of occupancy is issued it converts to a standard mortgage without a second closing, second set of costs, or second approval.
This surprises people. The lender reviews your builder's licence, insurance, financial standing and track record, and approves the plans and budget. A builder who has not been through this before can slow a file down considerably — bring us the builder early.
Funds release in stages against completed work, verified by inspection. Your builder needs to be comfortable operating on a draw schedule rather than a large deposit up front, which is normal for established builders and a genuine obstacle for some smaller ones.
Construction lending is slower to set up than a purchase and there are more ways for it to go sideways — budget overruns, builder delays, an appraisal that comes in under the finished cost. Contingency in the budget is not optional. And VA and USDA both have construction options, but the lender list for them is short.
A single loan that funds construction and then converts to permanent financing with no second closing and no requalifying.
Usually interest-only on the amount drawn so far, which starts small and grows as the build progresses.
Yes, VA construction financing exists, but relatively few lenders offer it. As brokers we can find the ones that do.
Tyler McCain is based in Lebanon, TN and works across the Nashville metro.
Tyler McCain is licensed in Alabama, Florida, Kentucky, Ohio, Tennessee and Texas. Programme rules are federal, but the markets are not.
Buy the house and finance the work in a single loan.
Read more →Zero down, no monthly mortgage insurance, earned through service.
Read more →As little as 3% down, with mortgage insurance that comes off.
Read more →Financing above the conforming limit without the bank runaround.
Read more →That depends on numbers we have not seen yet. Two minutes, no credit pull, and Tyler will tell you straight — including if the answer is a different programme entirely.
