Articles Tagged With: FHA One-Time Close Construction Loan

FHA One-Time Close Construction Mortgage Basics

July 19, 2020

FHA One-Time Close Construction Loan Rules

What do borrowers need to know about FHA One-Time Close construction loans? There are two very important areas to keep in mind. One involves the lender’s specific requirements to qualify for this single-close construction loan, and the other involves FHA loan rules. The two are not always identical and this is something to be aware of when going into the loan application process. FHA One-Time Close mortgages are different than existing construction loans because the home must be designed, built, and paid for from the ground up and there are varying time frames under which this will be done. Purchasing an existing construction home means getting to move in much more quickly, but the trade-off is that you are purchasing someone else’s home rather than having one built especially for | more...

Build on your own lot. Construction loan basics

June 15, 2020

First-Time Home Buyers: Build Your New Home With A One-Time Close Construction Loan

By Bruce Reichstein

Buying a home can be challenging for some first-time borrowers. Many newcomers to the mortgage market don’t know all their options open and in that situation it is easy to make choices that are less than fully-informed. One-Time Close construction loans are open to any financially qualified applicant and that includes FHA borrowers who have never purchased a home before but have good FICO scores and repayment history that has no late or missed payments in the last 12 months or better. One-Time Close loans are offered as FHA, VA, and even USDA mortgages. The FHA version is NOT need-based and features no income caps, unlike the USDA version. VA construction loans are intended only for qualifying military members, veterans, and certain surviving spouses of military members. For the average | more...

Construction Loans For First-Time Home Buyers

May 12, 2020

Building A Home As A New Borrower

By Bruce Reichstein

At press time, many portions of the United States are considering some kind of return to business as usual in the wake of lockdowns and coronavirus containment measures. For better or worse, some portions of the country are opening more than others and this will likely include real estate markets and house hunting as progress is made. And that means some first-time home buyers will be exploring their options soon. Did you know that even as a first time borrower, you may be eligible for a One-Time Close construction loan that allows the borrower to build a home on their own lot rather than buying someone else’s property? One-Time close loans are available for VA borrowers, FHA loan applicants, even USDA borrowers. These loans do require some additional legwork and | more...

May 1, 2020

FHA Construction Loan Facts: What You Need To Know

By Joe Wallace

There are many options available when you are searching for a house to buy. The first set of choices often involves the type of home loan you want to apply for–believe it or not there is no one-size-fits-all mortgage. If you want to purchase a condo with an FHA mortgage, for example, there is a specific loan and procedures for that. But what if you want to have a house built for you from the ground up? This is also an option, even for first-time home buyers. You can apply for a conventional one-time close construction loan, but you’ll be applying for conventional loan interest rates and terms; an FHA One-Time Close construction loan has a 3.5% down payment requirement, which is lower than you may be offered on a | more...

FHA One Time Close Construction Loan Option

April 30, 2020

The FHA One-Time Close Mortgage Option

By Bruce Reichstein

Borrowers looking at their FHA home loan options don’t have to feel limited to purchasing an existing construction property; there is a way to apply for an FHA mortgage that lets you have a home built to suit from the ground up. These FHA new construction home loans are referred to as Construction-To-Permanent mortgages or, more recently, FHA One-Time Close construction loans. One-Time Close construction loans are good for borrowers who want a home that is just right, and are not in a hurry to get into their new home. The trade-off for having just the right property built for you is the time it will take from planning to move-in. The process will take more time, but it is definitely worth it to those who choose this type of | more...

One-Time Close Construction Loan Options For Veterans

March 17, 2020

Your Construction Loan Options

By Bruce Reichstein

Build a home instead of buying an existing one? This is a reality and there are plenty of choices to go around; FHA One-Time Close construction loans, the VA construction loan equivalent, USDA construction loans, and even conventional mortgages to build on your own land instead of buying an existing home. These loans all have features that are different than existing construction loans. They include how long it takes for you to move in, when your mortgage payments begin, and the kinds of features your home may have. Construction loans can be a bit more complex than a new purchase loan for a house in a typical neighborhood, and some read articles like this and want to be ready to commit, but an equal number of people read this but | more...

March 16, 2020

Is It Safe To Apply For A One-Time Close Mortgage During The Coronavirus?

By Joe Wallace

Is it safe to apply for a One-Time Close construction loan during the coronavirus outbreak? Construction loans are offered for those who wish to apply for a home loan but don’t want to purchase existing construction. These loans are available for FHA borrowers, VA borrowers, even USDA applicants who meet program requirements may be approved. But what do you need to know about Construction loans during a time of national crisis such as the coronavirus? You May Need To Allow For Additional Processing Time Permitting and other official paperwork may be slow to be processed or approved depending on the government agency, demand, and local rules that may be in effect during a quarantine period, “stop movement”, or related restrictions aimed at slowing the spread of contagion. Don’t assume you | more...

February 24, 2020

FHA Mortgages For First-Time Borrowers In 2020

By Bruce Reichstein

What makes FHA home loans a great option for first-time home buyers? Anyone purchasing their first real estate, working with a realtor, and getting their credit ready for a home loan for the first time should know about the FHA mortgage program and it’s lower interest rates and flexible income requirements. FHA Loan Guidelines Are More Flexible It’s true that FHA mortgages require a borrower to have two years of employment history. But that history requirement does not have to be with a single company or employer. Borrowers should know that some frequent job changes are acceptable to FHA lenders, but overall your employment record is reviewed on a case-by-case basis when necessary. You may want to explain any unusual job circumstances to a loan officer up front to see | more...

February 19, 2020

For Borrowers Who Need Down Payment Help

By Joe Wallace

Buying a home is a major investment. And unless you are applying for a need-based loan such as a USDA mortgage, or if you are a qualifying veteran or military member applying for a VA mortgage, you will need to come up with a down payment. Borrowers who use conventional loans typically make larger down payments than those who use government-backed mortgage loans like FHA loans. Why? Because government-backed mortgages carry an advantage for the lender; they are guaranteed against loan default and foreclosure. Should the worst happen after the loan has closed, the government pays the lender a portion of the mortgage. It’s called a claim when this happens, and such claims are a risk of doing business in the mortgage market. Reduced risk for the lender is a | more...

February 18, 2020

Income Rules For FHA Loan Approval: What You Need To Know Today

By Joe Wallace

FHA home loans, like other mortgages, require the lender to make sure their applicants have enough income to be able to realistically afford the loan. This is known as “qualifying income” and the lender is only permitted to use earnings that meet FHA standards. Those paychecks must be stable, and likely to continue for the purpose of debt-to-income ratios and other loan approval procedures. Those regulations apply regardless of whether you are buying existing construction or want to build a house on your own lot using an FHA construction loan so it’s important to be familiar with them. Military Pay And Earnings: Yes, military people have access to the GI Bill and the VA home loan program, why would they need an FHA home loan? There are actually many reasons, | more...