Articles in Category: Special FHA Programs

Build on your own lot. Construction loan basics

May 4, 2021

First-Time Borrowers Can Build a Home Instead of Buying One

Even a first-time buyer dreams about having a house built especially for them from the ground up. Some taking their house-hunting journey for the first time are surprised to learn that their options include the ability to build a home on your own lot using a One-Time Close construction loan. One-Time Close construction loans, which feature only a single loan application and a single closing date, are offered as conventional mortgages, but also as VA and FHA construction loans. What should first-time home buyers should know about construction loans before committing? Don’t worry, these things won’t discourage you from getting the loan. But knowing some issues in advance may change how you prepare for your new home loan. Down Payments When building your home on your own land, a down | more...

April 12, 2021

Low Down Payment Construction Loans For New And Repeat Borrowers

By Bruce Reichstein

Are you interested in building your home from the ground up? A loan called the One-Time Close construction mortgage can help you as a first-time home buyer or as an experienced borrower. You don’t have to be a first-time borrower to take advantage of a low-down payment or even a zero down payment home loan you can use to build a house on your own lot. Among the first questions you are likely to ask about this type of loan? How much you’ll be required to provide as your down payment. And the answer you get depends on what kind of construction mortgage you seek. Do you know how much money you need to save up for a down payment? That depends on the nature of your mortgage; VA, FHA, | more...

April 7, 2021

FHA One-Time Close Mortgages Compared To VA One-Time Close Construction Loans

By Bruce Reichstein

Lots of people are interested in building a home using a One-Time Close construction mortgage (OTC). This is a great option for military officers, career enlisted members, military retirees, and veterans who want to construct a new home rather than buying somebody else’s house. These construction loans are offered by both the VA and FHA loan programs. But which is better for those who have the option of applyinf for a VA mortgage? Who VA Loans Are For VA loans and the VA One-Time Close construction loan program are intended for veterans and currently serving military members with qualifying minimum time on duty. Surviving spouses (of military members who have died as a result of military service) may also qualify to apply for the VA loan program. FHA loans, including | more...

One Time Close Mortgage Loans: The Base Home Sales Price

March 31, 2021

One-Time Close Construction Loans: Loan Limits

By Joe Wallace

Are you a house hunter who has gotten tired of looking at other people’s dream homes? Do you want to build your home instead of buying someone else’s? The One-Time Close construction loan is a good option for this; the One-Time Close loan eliminates the need for a second loan application and approval process compared to some other types of construction loans. There is more than one type of One Time Close mortgage to choose from–you could be eligible for a One-Time Close construction mortgage in multiple programs. Do you know which one is best for you? USDA One-Time Close Construction Loans We start with the need-based construction loan program offered by the USDA. The USDA One-Time Close construction loan program was created for borrowers on restricted incomes. This construction | more...

FHA Construction Loan Rule Changes In 2021

March 29, 2021

VA One-Time Close Construction Loans For Veterans

By Joe Wallace

Military members and veterans alike do well to explore their One-Time Close options to build a home instead of buying an existing house. There is an FHA One-Time Close loan veterans can use, but there is also a VA One-Time Close construction loan that is more idea for military members and veterans due to the zero-down option for the VA construction loan. Veterans and currently serving military members who are on the fence as to whether they should build or buy should explore their One-Time Close options in addition to looking for existing construction. The VA One-Time Close construction loan, sometimes referred to as a single close construction loan, can provide a distinct financial advantage for military families, retirees, and those who are about to retire or separate from military | more...

Construction Loan Advice For New Borrowers

March 24, 2021

FHA Loan Down Payments: Some Simple Rules

By Bruce Reichstein

What do you need to know about FHA loan down payment requirements? First, in most cases, a down payment is required, and your down payment requirements are dictated in part by your credit scores. But you also need to know that your down payment could be waived if you are applying for a construction loan and have land equity to use instead. There are FHA loan rules you should know while you are still in the planning stages of an FHA purchase loan. These will help you decide what to do about saving up for a down payment and dealing with certain closing costs. Basic Down Payment Rules As stated above, FHA loan rules usually require a minimum 3.5% down payment for all single-family mortgage loan transactions. But don’t overlook | more...

Home Loans For Building On Your Own Land

March 18, 2021

One-Time Close Construction Loan Advice For New Borrowers

By Joe Wallace

If you have never explored your options to build a house on your own lot with a One-Time Close construction loan, you might be surprised to learn that these loans are open to first-time borrowers and experienced home owners alike. Construction loans have great advantages for those who want to build a primary residence. But there are often important questions borrowers need to be answered before they can make an informed decision on building on their own lot. VA One-Time close mortgages for military members and veterans offer a no downpayment option, and FHA One-Time Close mortgages have a low 3.5% downpayment requirement. And the down payment issue is where we get started with our home loan advice. Down Payment Assistance For Construction Loans Most FHA and VA participating lenders | more...

March 11, 2021

FHA One Time Close Construction Loans Versus FHA Rehabilitation Mortgages

By Joe Wallace

There are FHA home loans you can apply for that allow you to build or renovate existing construction. One type of home loan–one that lets you build instead of buying existing construction–is the FHA One-Time Close (OTC) construction loan. An alternative, known as the FHA 203(k) Rehabilitation mortgage and it is used to repair or renovate a home. One-Time Close construction loans and FHA 203(k) Rehab loans are similar–these two loans need approved builders to do the work, and they both require a minimum down payment unless you choose a VA or USDA OTC loan instead. One-Time Close Down Payment Rules FHA One-Time Close loans have a 3.5% down requirement for those with FICO scores within the qualifying range. Borrowers with lower credit scores may be required to put 10% | more...

March 3, 2021

Which Construction Loan Is Right For You?

By Joe Wallace

There is a kind of home loan called a One-Time Close construction loan that lets you build a home on your own lot. There are government-backed One-Time Close construction loans offered including a USDA version of the One-Time Close construction loan, a VA Loan allowing you to do the same thing, and an FHA One-Time Close construction loan. The One-Time Close mortgage features a single application and closing date for the entire process–compare that to construction loans that feature one application and one closing date for the construction phase plus a separate application and closing date for the purchase of the property once it has been built. This is NOT how the process works with the One-Time Close loan which makes this process easier for borrowers and lenders by eliminating | more...

March 2, 2021

One-Time Close Construction Loan Advice

By Bruce Reichstein

If the idea of building a home instead of buying somebody else’s property appeals to you, the One-Time Close construction loan allows you to build a home from the ground up on your own lot (or on land you buy in conjunction with the mortgage). Building a home with plans you approve has plenty of advantages, but it also requires some extra consideration. It’s not terribly complicated to anticipate some important factors associated with your construction loan but it does take some time to get the information you need to make the most informed choices possible for your new home. If you want to build a home on your own lot instead of buying an existing house, the FHA One-Time Close construction mortgage is an option you should seriously consider. | more...